Legal Analysts

Thursday, January 07, 2021

Second PPP $ - The Rules are out NOW

How do you get your Paycheck Protection Program Second Draw Loan? 

The rules are out now and here are the top 10 rules that you should know:

  1. Last day to apply & receive a new PPP is March 31, 2021;
  2. To qualify, you must use or will use full amount of your First Draw PPP loan on or before disbursement of second loan; 
  3. SBA may forgive up to the full principal loan amount; 
  4. Interest rate is 1%; 
  5. Maturity is 5 years; 
  6. Borrower must have 300 or fewer employees;
  7. Borrower must have experienced a revenue reduction of 25% or greater in 2020 relative to 2019 (quarterly comparison); 
  8. When comparing 2020 relative to 2019, any forgiveness amount of a First Draw PPP Loan that a borrower received in calendar year 2020 is excluded from a borrower's gross receipts (not disqualified from the second loan because of the first one);
  9. Each hotel, restaurant, or news organization with a location owned by a parent business in a separate legal business entity and employing not more than 300 employees is permitted to apply for a separate PPP loan; and
  10. Maximum loan amount = 2.5 months of the borrower's average monthly payroll costs.