New Pandemic Relief Bill - Updated 1/11/2021

A new round of PPP funding:

  • First draw applications open January 11, 2021
  • Second draw applications open January 13, 2021
  • Applications open until March 31, 2021 or until funds are depleted
  • Includes additional $284 billion; businesses can apply for a second round of PPP. 
  • The bill designates $12 billion for minority-owned and very small businesses, and $15 billion in grants for live venues. 
  • Provides a business with a forgivable loan based on 2.5 times its monthly payroll costs. Restaurants and hotels, however, can seek forgivable loans based on 3.5 times monthly payroll costs. 
  • Enhanced Access to PPP; today’s plan reflects the reality that many mid-sized and larger restaurant and hotel groups are on the verge of bankruptcy and allows both to qualify for PPP as long as they do not employ more than 300 employees at each physical location. 
  • Simplified PPP loan forgiveness application for loans under $150,000.
  • Expanded list of eligible expenses (now includes software, cloud computing, HR, accounting, property damage not covered by insurance, supplier costs, and PPE).
  • Repeals CARES Act provision requiring borrowers to deduct EIDL advance from PPP loan amount.
  • Includes funding for Destination Marketing Organizations (DMOs).

 SBA Programs:

  • Provides $20 billion to restart and expand EIDL grant program for small businesses.
  • Creates a process for existing EIDL Advance grantees that received less than $10,000 to reapply for the difference.
  • Provides $3.5 billion to resume the principal and interest payments of new and existing loans guaranteed under the 7(a), 504, and Microloan programs.
  • Supplies $2 billion to enhance the 7(a), 504, and Microloan programs, waives borrower and lender fees within the 7(a) and 504 programs, and increases the 7(a) loan guarantee to 90 percent.
  • Extends the $1 million loan limit for SBA Express Loans.
  • Establishes a 504 Express Loan program.

 Debt and tax relief:

  • Extends CARES Act banking relief through the end of 2021, which will enable hoteliers to seek additional forbearance from their banks on their conventional loans.
  • Allows the deductibility of PPP loans.
  • Expands and extends the Employee Retention Tax Credit through June 2021.
  • 100-percent deduction for business meals paid or incurred in 2021 and 2022. 

 Other key provisions:

  • Extension of the Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation programs for 11 additional weeks; this includes an additional $300 per week in unemployment insurance through March 14, 2021.
  • A one-year extension to the time states and localities have to spend previously-received coronavirus relief funds.
  • Stimulus checks up to $600 per child and adult for individuals making up to $75,000 per year (same cap as earlier CARES Act); distribution will begin next week.
  • Extension of the moratorium on evictions through the end of January 2021.

Payroll Protection Program (PPP) Loan Forgiveness Explained

The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 60% of the forgiven amount must have been used for payroll). There are two forms available for borrowers to use to apply for forgiveness, Form 3508 and the Form 3508EZ. Borrowers can use the new EZ application if they meet the following requirements:

  • "Are self-employed and have no employees, OR"
  • "Did not reduce the salaries or wages of their employees by more than 25% and did not reduce the number or hours of employees; OR"
  • "Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%."

Form 3508

PPP Loan Forgiveness Application Instructions (Revised 11/30/20)

PPP Forgiveness Worksheet With Safe Harbor Test

PPP Loan Forgiveness Application (Revised 11/30/20)

Form 3508EZ

PPP Loan Forgiveness EZ Application Instructions (Revised 11/30/20)

PPP Forgiveness Worksheet for the EZ Application

PPP Forgiveness Application 3508EZ (Revised 11/30/20)

Videos and webinar on PPP forgiveness