Jeff Flock of FOX Business on relief limits for small businesses and how companies are adapting in the midst of the pandemic.
The Small Business Administration is reopening the Paycheck Protection Program for more creditors on Friday, with the second iteration of the popular program starting earlier this week.
All financial institutions with $ 1 billion or less in assets can reopen their PPP loan programs on Friday.
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Creditors with larger assets can do this on Tuesday.
“The second round of PPP could not have happened at a better time, and the SBA is making every effort to ensure that small businesses have the emergency financial support they need to continue to face this moment of uncertainty,” said the administrator. of the SBA, Jovita Carranza, in a statement.
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Small community creditors began accepting applications earlier this week as a means of ensuring that smaller companies could apply for the relief they need.
Borrowers will be able to apply for a loan by the end of March.
A December relief bill allocated $ 284 billion for additional loans, although the qualification terms have been slightly modified for second-tier loans.
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Eligible companies must have 300 employees or less and must be able to show a 25% drop in revenue between the last quarter of last year and the same period in 2020.
Loans can be distributed up to a maximum value of $ 2 million, or 2.5 times the average monthly payroll costs of 2019 or 2020. To obtain forgiveness, at least 60% of the money must be applied to expenses with payroll, while the rest can go to rent, mortgage and utilities.
The good news for beneficiaries is that, this time, those who have had their loans forgiven can claim tax incentives on deductible expenses.
First Draw loans will also be available to borrowers who did not receive money before August 8, 2020.