Numerous small enterprises are still battling to survive as the COVID-19 pandemic’s effects on the economy continue. Thankfully, the Paycheck Protection Program (PPP) has been expanded and updated to offer qualified firms a second draw of funding. This post will cover the process for submitting a second PPP loan application as well as the qualifications and paperwork needed.
Yes, applications for PPP second draw loans are still being accepted by the Small Business Administration (SBA). On January 13, 2021, the application period began. It will end on March 31, 2021. It’s vital to remember that organizations who obtained a PPP loan must have spent the entire amount for allowable costs before requesting a second draw. What Records Do I Need for the Second PPP?
Businesses must submit the following paperwork to be considered for a second draw of PPP funding: 1. A completed SBA Form 2483-SD (Application for Second Draw PPP Loan). Documenting payroll costs with Form 1099-MISC filings, payroll tax returns, and revenue and expense statements from sole proprietorships is step two. 3. Evidence of at least a 25% drop in revenue from 2019 to 2020. Tax returns, financial statements, or bank statements can be used to prove this.
Yes, companies that got a PPP loan in 2020 under the first draw may be eligible for a second draw in 2021. Businesses must, however, fulfill a few criteria in order to be eligible for a second draw. For instance, companies cannot apply for a second draw until they have spent the entire amount of their first PPP loan and have 300 or fewer employees. Who Can Participate in the PPP’s Second Round? Businesses must fulfill the following requirements in order to be eligible for a second draw of PPP funding:
1. Be a sole proprietorship, an independent contractor, a self-employed person, or operate under an NAICS code that starts with 72 (Accommodation and Food Services)
2. Have 300 or fewer employees
3. Have received a first draw PPP loan in the past and have used the entire amount for eligible expenses
4. In conclusion, small firms that are still having trouble as a result of the COVID-19 outbreak will receive much-needed relief from the PPP second draw. Businesses must meet eligibility standards and present proof of payroll costs and revenue decrease in order to submit an application for a second draw. Eligible businesses should move swiftly to apply for this financial opportunity since the application window is only open until March 31, 2021.