Hey folks, are you wondering whether there are still PPP funds available? This has been a hot topic since the start of the pandemic, and rightfully so. All the economic turmoil has caused a lot of people to struggle, so the Paycheck Protection Program has been a much-needed lifeline for many small business owners. If that’s you, then it’s completely understandable that you’d want to know whether there are still funds up for grabs.
As you may already know, the PPP is a federal loan program that was designed to help businesses affected by the pandemic. It provides loans to help businesses keep their employees on the payroll, and it can also be used to cover certain other expenses. In the first round of funding, the program distributed over $525 billion. The second round of the program started earlier this year, but we’ve all been wondering how much of those funds are still available.
Considering how much of an impact the COVID-19 crisis has had on the economy, it’s no wonder that there’s a lot of interest in this topic. According to recent reports, the demand for PPP loans has been quite high since the second round of funding began. But the big question still remains: how much of those funds are left? Stay tuned, because we’ve got some answers for you.
PPP Loan Extension
In response to the ongoing COVID-19 pandemic, the government has extended the deadline for small businesses to apply for PPP loans. Initially set to expire on March 31, 2021, the deadline for PPP loan applications has been extended to May 31, 2021. This extension offers a glimmer of hope for small business owners who have been struggling to stay afloat during these trying times.
- Another key aspect of the PPP loan extension is the additional funding that has been released. In March 2021, the Biden administration signed into law the American Rescue Plan Act, which added $7.5 billion to the PPP program. This influx of funds has made it easier for small businesses to secure loans, even if they missed out on the initial rounds of funding.
- Additionally, the new legislation has expanded eligibility requirements, so more small businesses are now eligible for PPP loans. For example, small business owners who are delinquent on their student loans are no longer automatically disqualified from receiving PPP funding.
- There are also new provisions that increase funding for small businesses in underserved communities. This is an important step towards ensuring that all small businesses have access to the resources they need to survive and thrive in a post-COVID world.
Overall, the PPP loan extension represents a much-needed lifeline for small businesses that have struggled to stay afloat during the pandemic. With additional funding, expanded eligibility requirements, and a longer application window, small business owners have a better chance of securing the funding they need to keep their doors open and their employees working.
If you’re a small business owner who has not yet applied for a PPP loan, now is the time to act. Reach out to your lender or financial advisor to discuss your options and take advantage of the resources available to you. With a little help, you can weather this storm and emerge stronger on the other side.
Eligibility Requirements
The Paycheck Protection Program (PPP) was created to provide financial assistance to small businesses impacted by the COVID-19 pandemic. While the program was initially launched in 2020, Congress passed additional legislation in December 2020 and March 2021 that replenished and expanded funding opportunities. As of August 2021, there are still PPP funds available for eligible businesses.
- First-time borrowers can apply for PPP funds if they meet the following requirements:
- The business must have been in operation on or before February 15, 2020
- The business must have 500 or fewer employees or meet the SBA’s size standards for their industry
- The business must have suffered at least a 25% reduction in revenue due to the COVID-19 pandemic
- Second-time borrowers can apply for PPP funds if they meet the following requirements:
- The business must have received and used all funds from their first PPP loan before receiving their second loan
- The business must have 300 or fewer employees or meet the SBA’s size standards for their industry
- The business must have suffered at least a 25% reduction in revenue due to the COVID-19 pandemic
Additional eligibility requirements may apply, depending on the lender and loan program. However, the above requirements are the basic criteria that must be met. It is important to note that the application process for PPP loans can vary, and businesses should work closely with their lender to ensure they are following all necessary steps.
Below is a table that outlines the key differences between first-time and second-time PPP loans:
| First-Time PPP Loan | Second-Time PPP Loan |
|---|---|
| Borrower must have been in operation on or before February 15, 2020 | Borrower must have received and used all funds from their first PPP loan before receiving their second loan |
| Borrower can receive up to 2.5 times their average monthly payroll costs | Borrower can receive up to 2.5 times their average monthly payroll costs, or 3.5 times if they are in the hospitality industry |
| Maximum loan amount is $10 million | Maximum loan amount is $2 million |
Overall, PPP loans can be a vital source of funding for small businesses impacted by the pandemic. Eligibility requirements may vary depending on the lender and loan program, but businesses that meet the above requirements may be eligible to apply for PPP funds.
Application Process
The Paycheck Protection Program (PPP) is a loan program designed to provide small businesses with the funds they need to keep their employees on the payroll during the pandemic. The program was launched by the U.S Small Business Administration (SBA) in April 2020, and it was initially funded with $349 billion. However, due to high demand and the need for additional funding, an additional $320 billion was allocated to the program in April 2021. This means that there are still PPP funds available for small businesses in need.
How to Apply for PPP Funds
- The application process for PPP funds is straightforward. You can apply through any participating lender, including banks, credit unions, and other financial institutions.
- You will need to fill out the SBA’s Paycheck Protection Program borrower application form, which can be downloaded from the SBA’s website.
- In addition to the application form, you will need to provide documentation to support your eligibility for the program and the amount of funds you are requesting. This may include payroll records, tax documents, and financial statements.
PPP Loan Forgiveness
If you are approved for PPP funds, it’s important to understand the loan forgiveness process. PPP loans may be fully or partially forgiven if certain terms and conditions are met. These include:
- Using the funds for eligible expenses, such as payroll costs, rent, utilities, and mortgage interest.
- Spending at least 60% of the funds on payroll costs.
- Maintaining employee and compensation levels.
- Submitting a forgiveness application to your lender.
PPP Loan Size
The size of your PPP loan will depend on your average monthly payroll costs, as well as other factors such as your industry and number of employees.
| Business Type | Loan Size Formula |
|---|---|
| Sole proprietors, independent contractors, and self-employed individuals | Average monthly net profit x 2.5 |
| Businesses with employees | Average monthly payroll costs x 2.5 |
| Businesses in the accommodation and food services industry | Average monthly payroll costs x 3.5 |
Keep in mind that the maximum loan size for any borrower is $10 million.
Loan Forgiveness
One of the most attractive features of the Paycheck Protection Program (PPP) is loan forgiveness. The program offers borrowers the chance to have their loans entirely forgiven if they use the funds for eligible expenses. These expenses include payroll costs, rent, utilities, and mortgage interest.
- To be eligible for loan forgiveness, borrowers must use at least 60% of the PPP funds for payroll costs.
- The remaining 40% can be used for eligible non-payroll expenses.
- Loan forgiveness is based on maintaining employee and salary levels. If a borrower reduces the number of employees or their salaries during the covered period, loan forgiveness may be reduced.
The covered period for loan forgiveness begins on the date the borrower receives the PPP funds and ends 24 weeks later or on December 31, 2020, whichever comes first. Borrowers must apply for loan forgiveness through their lender.
The Small Business Administration (SBA) issued guidance on loan forgiveness that includes an application and instructions for borrowers to complete the forgiveness process. The application requires borrowers to provide detailed information on how they used the funds and how they maintained employee and salary levels during the covered period.
| Criteria | Amount Eligible for Forgiveness |
|---|---|
| Payroll Costs | Up to 100% |
| Rent | Up to 40% |
| Utilities | Up to 40% |
| Mortgage Interest | Up to 40% |
Borrowers should also keep detailed records of how they used the PPP funds and maintain these records for six years. These records may be requested by the SBA or the borrower’s lender during a loan review.
Loan forgiveness is a significant benefit of the PPP and can help small businesses weather the economic impact of the COVID-19 pandemic. However, borrowers should be diligent in keeping accurate records and following the guidelines to ensure they are eligible for loan forgiveness.
Loan Amount Calculation
Calculating the loan amount you are eligible for under the Paycheck Protection Program (PPP) can be a bit confusing. This loan amount calculation varies depending on the type of business and the way its financial statements are organized. However, there are a few general rules that apply.
The PPP is designed to provide small businesses with low-cost loans to cover payroll and other expenses during the COVID-19 pandemic. The loan amount you can apply for is based on your average monthly payroll costs. This figure includes salaries, wages, tips, commissions, benefits, and state and local taxes.
There are different methods to calculate payroll costs, depending on whether you’re applying as a sole proprietor, an independent contractor, or a business with employees. In general, the maximum loan amount that you can apply for is 2.5 times your average monthly payroll costs, up to a maximum of $10 million.
Calculating Payroll Costs
- For employers with employees: To calculate average monthly payroll costs, take the total payroll expenses for the last 12 months (including salaries, wages, tips, health insurance, retirement benefits, paid time off, state and local taxes, etc.) and divide by 12. Then, multiply that number by 2.5.
- For self-employed individuals: Your maximum loan amount is based on your net earnings from self-employment for the 2019 tax year. Divide that number by 12 and multiply by 2.5.
- For new businesses: If you were not in business for the entire 2019 fiscal year, your average monthly payroll costs are based on the period from January 1, 2020, through February 29, 2020. Divide that number by the number of months in that period and multiply by 2.5.
Applying for a PPP Loan
Once you have calculated your loan amount, you can apply for a PPP loan through an approved and participating lender. As part of your application, you will need to provide documentation for your payroll costs, including payroll tax filings, quarterly tax filings, and proof of expenses. Other supporting documents such as bank statements, profit and loss statements, and tax returns may also be required.
Keep in mind that the PPP program is constantly evolving and changing, so it’s important to stay informed on the latest updates and guidelines. You can also seek the guidance of a financial advisor or accountant to ensure that you are accurately calculating your loan amount and following all the necessary steps to qualify for loan forgiveness.
| Loan Amount Calculation Examples | Loan Amount |
|---|---|
| Average Monthly Payroll = $20,000 | $50,000 |
| Net Earnings from Self Employment = $30,000 | $18,750 |
| Average Monthly Payroll (new business) = $15,000 | $37,500 |
In conclusion, determining your loan amount under the PPP requires careful calculations based on the nature of your business and its financial records. However, following the general guidelines provided by the SBA and staying informed on the latest updates can help ensure that you’re accurately computing your loan amount and securing the support your business needs to navigate the COVID-19 pandemic.
SBA Lender Search
One of the most crucial steps in securing PPP funds is finding a lender that can provide the loan. Thankfully, the US Small Business Administration (SBA) has an online tool that helps you find lenders in your area. The SBA Lender Search is a free online directory that allows business owners to search for local lenders that participate in the SBA loan programs.
- Using the SBA Lender Search is relatively easy. Simply enter your zip code, and the search tool will provide a list of lenders in your area that are approved to offer PPP loans.
- It’s important to note that not all banks and lenders are approved to offer PPP loans. The list of participating lenders changes frequently, so it’s essential to check the SBA Lender Search regularly for updates.
- Another advantage of the SBA Lender Search directory is that you can filter by loan type and business size to find lenders that specialize in your specific needs. This can save time in the loan application process and increase the likelihood of approval.
Overall, the SBA Lender Search tool is an excellent resource for business owners looking to secure PPP funds. It provides an easy way to find participating lenders and ensures that you’re working with a reputable bank or lending institution.
Conclusion
While PPP funding has been exhausted several times, there are still funds available for eligible businesses. Applying for PPP funds can be a complex process, but there are resources available to help you navigate the loan application process. Whether you need assistance finding a lender or understanding the application requirements, there is help out there to ensure that your business can receive the financial support it needs.
Use of PPP Funds
The Paycheck Protection Program (PPP) was established in response to the economic impact of the coronavirus pandemic. It provides financial assistance to small businesses and non-profit organizations to help them keep their workforce employed during this challenging time. PPP loans can be used for a variety of expenses including:
- Payroll costs, including salaries, wages, and benefits
- Rent or mortgage payments
- Utilities
- Operations expenses, such as software or cloud computing
- Property damage costs due to public disturbances not covered by insurance
- Supplier costs necessary to maintain current operations
- Worker protection expenses related to COVID-19
Many small businesses and non-profit organizations have been impacted by the pandemic and have used PPP funds to cover their expenses during this difficult time. The funds have helped businesses keep their doors open and retain their employees, despite the economic challenges.
Guidelines for PPP Funds Usage
While PPP loans can be used for a variety of expenses, borrowers must follow certain guidelines to ensure that the funds are used appropriately. Borrowers must use at least 60% of the loan for payroll expenses to be eligible for loan forgiveness. Additionally, borrowers must use the funds within the allotted time period, which is generally 24 weeks after receiving the loan. PPP funds cannot be used to pay dividends or bonuses to owners or for lobbying activities. Borrowers must also keep accurate records of how the funds were used for auditing purposes.
PPP Loan Forgiveness
PPP loans may be eligible for forgiveness if the borrower meets certain requirements. To be eligible for loan forgiveness, borrowers must use at least 60% of the loan for payroll expenses and maintain their staff and employee salaries. Forgiveness may be reduced if the borrower reduces their workforce or employee salaries. Borrowers must apply for loan forgiveness through their lender and provide documentation that the funds were used appropriately.
Conclusion
| Pros of PPP Loans | Cons of PPP Loans |
|---|---|
| Provides financial assistance to small businesses and non-profits during the pandemic | Some borrowers may not be eligible or maximally benefits from PPP funds |
| Funds can be used for a variety of expenses, including payroll, rent, and utilities | Guidelines must be followed to ensure proper use of funds |
| PPP loans may be eligible for forgiveness | Borrowers must keep accurate records and apply for loan forgiveness through their lender |
Overall, PPP funds have been a lifeline for small businesses and non-profit organizations during this difficult time. While borrowers must follow guidelines to ensure proper use of funds, PPP loans have provided businesses with the financial assistance they need to keep their workforce employed and their doors open.
Are there still PPP funds available?
1. What is PPP?
The Paycheck Protection Program (PPP) is a loan program created by the U.S. government to help small businesses during the COVID-19 pandemic.
2. Did the PPP run out of funds?
The PPP ran out of funds in May 2021 but received a new injection of $284 billion in December 2020 through the new Economic Aid Act.
3. Are PPP funds still available?
Yes, PPP funds are currently available for small businesses that have not received a loan yet and for those who have exhausted their first loan and meet certain eligibility requirements.
4. Who is eligible for PPP funds?
Small businesses, sole proprietors, independent contractors, and nonprofits with fewer than 500 employees or meet certain industry-specific requirements may be eligible for PPP funds.
5. How do I apply for PPP funds?
You can apply for PPP funds through a participating lender. You will need to provide documentation to demonstrate eligibility and financial need for the loan.
6. What can PPP funds be used for?
PPP funds can be used to cover expenses such as payroll, rent, utilities, and other business-related expenses.
Closing Thoughts
We hope that this article has answered your questions about whether there are still PPP funds available for small businesses. If you’re eligible and in need, apply for PPP funds through a participating lender. Thank you for reading, and please visit us again for more insights and information about small business financing.