What You Need to Know about the updated Covid-19 Relief Bill:
Updated as of 1/5/2021 and subject to change as more information becomes available
Here are a few updates regarding the Covid-19 Relief Bill.
First Update: PPP Round 2 is here
Applications will be opening up soon, and the deadline will be on 3/31.
- Have fewer than 300 employees
- Have used all or plan to use all of the first PPP loan
- Have a decline in sales of at least 25% in any quarter of 2020 in comparison to that same quarter in 2019 (ex. sales in Q1 2020 must be at least 25% less than sales in Q1 of 2019)
PPP New Loan Terms, Lenders may not:
- Charge a yearly fee
- Charge a guaranteed fee
- Charge a prepayment penalty
- Request collateral or a personal guarantee
Second Update: You no longer have to pay back the EIDL GRANT
NOTE: This is the grant portion, not the loan itself! (Remember those $1k grant advances you may have received per employee? You were supposed to reduce your PPP loan forgiveness for them, but you no longer need to.)
When you apply for forgiveness, they’ll remove this piece of the application and you should be able to get full forgiveness of your PPP loan (assuming all other factors are met). Also, if you’ve already applied, you can amend.
Third Update: You are able to write off PPP expenses this tax season
In the bill it states that there shall be no denial of write offs. So we shall see what the IRS does with this. This is huge as a lot of Taxpayers were upset that they were unable to deduct expenses with the funds they received from this loan.
As things unfold, changes are continuously being made. I encourage you to continuously check with your Banks regarding the PPP Loan application, although I am sure once the application becomes available, banks will likely notify many on the ability to start applying.
Hope this helps!