Starting on Wednesday, February 24th, only businesses with fewer than 20 employees will be allowed to apply for the current round of the Paycheck Protection Program (PPP). This restriction will stay in place for two weeks, allowing lenders to focus on getting funding to these small businesses. The application eligibility will revert to normal on March 10th.
Other changes include adjustments made to how sole proprietors, independent contractors, and self-employed individuals calculate their PPP funding amounts. The Small Business Administration (SBA) will now allow these groups to use the same methods as farmers and ranchers. The PPP funding would now be based on gross revenue (up to $100,000) rather than net income. This change applies for any PPP loan. This includes a first-round PPP loan if the recipient did not get one in 2020 as well as requesting an increase to a PPP loan they did receive in 2020. Only first-round PPP loans that have not already been forgiven are eligible for this increase request.
The PPP program has seen numerous changes since its implementation last year. These are just the latest ones. At Malloy, Montague, Karnowski, Radosevich & Co., P.A. (MMKR), we stay on top of these changes so that you can focus on your own business. If you would like to discuss how these latest updates specifically apply to you, contact our team today to schedule a consultation with one of our accountants.