Updates on Recovery 2.0 Loans, Grants, Forgiveness, and Tax Fixes

Date: January 07, 2021

New SBA rules released late yesterday

The long-awaited step by Congress and the President to provide COVID-19 recovery financial assistance was signed into law last week, and it provides a series of hard-fought victories for America’s small businesses. The COVID-19 recovery package will offer a second, more targeted round of funding for both the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) Advance Grants. It also makes several business-friendly tax changes to both loan programs and extends some of the tax credits from the first recovery package.

 

“At every stage of this crisis, we’ve fought to secure the relief and resources that America’s small businesses need to recover,” said NFIB Vice President of Federal Government Relations, Kevin Kuhlman. “NFIB and small business owners have called on Congress for months to provide the relief enacted in late December and we appreciate the support of legislators who heard the voice of small business, addressed our concerns, and secured this urgent and necessary assistance.”

Resources for Business Owners
To help small business owners make the most of the latest financial assistance, we’ve published several essential resources:

“Many small businesses right now are facing the most difficult time since the initial shutdown last spring. The winter months are bringing new challenges related to weather conditions, increased cases of COVID-19, and renewed business restrictions across the country. It is crucial that they access the new financial recovery provisions as quickly and easily as possible,” said Holly Wade, Executive Director of the NFIB Research Center of the need for relief and support for small businesses.

NFIB launched weekly COVID-19 webinars and research surveys in March, to support small business owners struggling to keep their doors open and workers employed. NFIB’s educational resources offer small businesses information on how to comply with the new loan programs, new paid family leave laws, and more. A dedicated email address is also available for small businesses’ COVID-19 recovery inquiries and we’ve answered more than 10,000 individual questions. Please don’t hesitate to email us.

New SBA Guidance Released Late Yesterday
Late yesterday the U.S. Small Business Administration published guidance to begin rolling out the COVID-19 recovery package signed into law on December 27. We’re analyzing the guidance and will provide more information. Among the key takeaways in yesterday’s guidance:

  • Applicants can use 2019 or 2020 average monthly payroll for calculating PPP loan amount
  • Restaurant and hospitality businesses (NAICS 72) are eligible for 3.5x average monthly payroll in calculating their loan amount
  • New seasonal employee formula for calculating loan amount if applicable
  • Expands the list of qualified expenses for first- and second-draw PPP loans

Here are SBA’s latest rules published January 6, 2021:

  1. Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act 
  2. Interim Final Rule on Second Draw Loans

More Resources

See NFIB’s COVID-19 recovery 2.0 fact sheet, NFIB’s bi-weekly COVID-19 webinars, NFIB’s Guide to Federal Lending Options, and our Coronavirus Resources page for answers to your most common questions. Information is also available from the U.S. Small Business Administration.

 

Related Content: Analysis | Coronavirus | Economy | National | Taxes

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