SBA Released New PPP Loan Applications
January 12, 2021
On Friday, January 8, 2021, the SBA released two new Paycheck Protection Program applications for new first time and second draw borrowers. The program is slated to close on March 31, 2021 or when funding runs out.
The PPP re-opened on Monday, January 11, 2021 but only to first-time borrowers who receive their loans through specific federally designated community development financial institutions and minority depository institutions. On Wednesday, January 13, 2021 these same institutions will open for second draw loans. Shortly thereafter, first and second draw loans will be available from other participating lenders. Businesses, non-profits, self-employed and independent contractors who would like to apply should contact their lenders to see when they will begin accepting applications.
The two new applications released are below – the relevant application and supporting information will need to be completed for a business’ first or second draw loan:
The supporting information needed to apply for first and second draw loans is generally the same; for Second Draw applications, the original lender may have this information already on file.
- Proof of established business as of February 15, 2020
- 2019 or 2020 Payroll tax returns – Forms 941 and state unemployment
- 2019 or 2020 Schedule C or Form 1065 K1s for self-employed/ partnership borrowers
In addition to utilizing the funds on payroll and forgivable costs, in order to receive forgiveness of the Second Draw PPP loan, a business must also demonstrate a 25% reduction of gross revenue in one quarter of 2020 relative to the same quarter in 2019 (or, a reduction of more than 25% annually, as indicated by comparing revenue reported on the 2019 and 2020 the tax returns). This information is only required on the application if the loan amounts exceeds $150,000, otherwise it is only required at the time of forgiveness.
You can read more specifically about the Second Draw PPP in our commentary here.
We are available to discuss this newly released information. Please call us at 203-852-7088 or email if you have questions.