Limited PPP Reopening

​Yesterday, the Paycheck Protection Program (PPP) reopened in a limited capacity. Monday’s opening was scheduled to be a specific window for financial institutions that serve minority and women-owned business to apply for first-time PPP loans. On Wednesday, the program will begin allowing these financial institutions to begin accepting applications for second-time PPP loans.

The application window for PPP loans will open to additional financial institutions “a few days later” and is scheduled to remain open until March 31. However, it is possible that with the limited funding (just over 50% of the first-round funding) that is possible funding could run out. If you are considering applying for a PPP loan in this window we recommend applying early.
 
Additional guidance has been released related to the newest round of the PPP. To learn more details, check out the following Journal of Accountancy articles:

• Date set for limited PPP reopening
• PPP application forms released

 
Some additional features of the new loans you may find noteworthy are as follows:

• Borrowers are generally eligible for the second round of PPP loans, up to $2 million if they have:
  • 300 or fewer employees
  • Fully used their first PPP loan by designated dates
  • Experienced a revenue reduction of 25% for at least one quarter of 2020 as compared with the same quarter of 2019
• Standard PPP loans are based on 2.5 times average monthly payroll costs. However, certain borrowers can now receive up to 3.5 times their average monthly payroll costs on second-draw loans if they have a NAICS code starting with 72 (hotels and restaurants). 
• The loans can now cover additional operating expenses

 
If you have any questions, contact your accountant, and remember to follow us on LinkedIn to stay up to date on all of our posts.