Updates for Small Business Loans
Tim Wilson is the local Small Business Association (SBA) Director. His contact information is also included.
He would be able to help answer any questions.
Key provisions from the legislation include:
- $284 billion for another round of forgivable Paycheck Protection Program (PPP) loans.
- PPP borrowers who already received a loan may obtain a second draw if they have 300 or fewer employees, have used or will use the full amount of their first PPP loan, and can show a 25% gross revenue decline in any 2020 quarter compared with the same quarter in 2019.
- First time PPP borrowers may obtain a PPP loan under the original terms in the CARES Act.
- 60% of PPP loans must be used to cover payroll.
- One-page borrower certification for PPP loans less than $150,000. The SBA must create the simplified application form within 24 days of the bill’s enactment and may not require additional materials unless necessary to substantiate revenue loss requirements or satisfy relevant statutory or regulatory requirements.
- Expands PPP forgiveness to include some worker protection and facility modification expenditures to comply with COVID-19 federal health and safety guidelines.
- Income exclusion and expense deductions for payments made on Section 7(a) SBA loans, including PPP.
- Borrowers with eligible SBA loans will receive an additional 1112 payments for three months of principal and interest starting in February 2021. The payments are capped at $9,000 per month.
- The $10,000 Economic Injury Disaster Loan (EIDL) advance will no longer be deducted from a borrower’s forgiveness amount. The SBA will issue rules to ensure that borrowers are made whole if they received forgiveness and the EIDL advance was deducted from that amount.
- Expenses paid with forgiven PPP loan proceeds are tax-deductible. This overrides previous The Internal Revenue Service (IRS) guidance disallowing deductions for these eligible expenses.
Tim Wilson, Director
Northeast Texas Small Business Development Center
P.O. Box 1307, Mt. Pleasant, Texas 75456
Office 903.434.8237 Mobile 903.717.1552
Vistit : http://northeastTXsbdc.org