By: William A. Buck, Esq.
On December 21, 2020, Congress approved the Consolidated Appropriations Act, 2021, which included “Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act” (the “Act”). The Act supplements the Paycheck Protection Program (PPP), established under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, with an additional $284B available for PPP loans to employers as well as other funding opportunities.
An overview of the Act includes:
- PPP loan to employers with 300 or fewer employees that have sustained a 25 percent revenue loss in the first, second or third quarter of 2020, relative to the same quarter in 2019.
- PPP loan equal to 2.5 times borrower’s average monthly payroll costs, capped at $2 million.
- Forgivable expenses under PPP are expanded to include supplier costs and investments in facility modifications and PPE to operate safely.
- Payroll costs and nonpayroll costs, as defined in the CARES Act, paid for with the proceeds of PPP loans are now tax deductible, reversing an IRS Revenue Ruling in November 2020.
- Funding for independent live venue operators affected by COVID-19 stay-at-home orders.
- Additional funding for SBA programs to:
- increase guarantees on SBA 7(a) loans and reduce fees on 7(a) and 504 loans;
- provide loan subsidies for 7(a) loans; and
- provide Economic Injury Disaster Loan grant advances.
If you have any questions about PPP, please contact William A. Buck. William A. Buck is a partner in the Corporate and Taxation Practice Groups and is based in the firm’s Pittsburgh office. Bill can be reached at 412.261.1600 or email@example.com.
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