The Paycheck Protection Program (PPP) now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP Loan. These loans qualify for full loan forgiveness if during the 8 to 24 week covered period:
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- Employee and compensation levels are maintained
- Loan proceeds are spent on payroll costs and other eligible expenses, and
- At least 60% of the proceeds are spent on payroll costs.
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
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- Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses. It is not a requirement that forgiveness of the first loan has been applied for or been received.
- Has no more than 300 employees, and
- Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
The deadline to apply is March 31, 2021. A copy of the application can be found here.
SBA is also reopening the PPP for First Draw Loans. These loans qualify for full loan forgiveness if during the 8 to 24 week covered period:
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- Employee and compensation levels are maintained
- Loan proceeds are spent on payroll costs and other eligible expenses, and
- At least 60% of the proceeds are spent on payroll costs.
The deadline to apply is March 31, 2021. A copy of the application can be found here.
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