The US Senate and House of Representatives passed the $900 billion COVID-19 relief bill last night. The final legislation, the Consolidated Appropriations Act, 2021, had small differences to what we shared in our update yesterday. While all of the things we posted yesterday are contained in the over 5,500 page bill, there are some small differences that are highlighted below along with additional legislation you may be interested in.
Eligibility For Second Round of PPP Loans (PPP2)
Eligibility requirements for a PPP2 loan are:
PPP Eligibility for 501(c)(6) Organizations
Organizations classified as 501(c)(6) are now eligible for PPP loans if they:
EIDL Emergency Grants Do Not Reduce Amount of PPP Forgiveness
The CARES Act established EIDL Emergency grants of up to $10,000 for qualifying businesses. If a business received an EIDL Grant and then subsequently received a PPP loan, the amount of PPP forgiveness was to be reduced by the amount of the EIDL grant. The new bill removes this so that there is no reduction in forgiveness for those who received a PPP loan and an EIDL Grant.
EIDL Grants Available Again
A new trough of dollars was put into the EIDL program and EIDL Grants of up to $10,000 are again available for those businesses that qualify but did not receive them in the first round. Additionally, if a business did not receive their full EIDL Grant of $1,000 per employee up to $10,000 in the first round, they can apply to receive their full amount.
Employee Retention Credit Extended and Changed
The employee retention credit is extended until July 1, 2021 (previously it ended January 1, 2021). The credit is also modified so that:
Previously borrowers of PPP loans could not take advantage of the Employee Retention Credit. There is language in the bill which should allow for PPP borrowers to now take the credit on qualified wages paid that were not forgiven via a PPP loan. We are waiting for more guidance to understand exactly what circumstances allow for a PPP borrower to take the employee retention credit.
Extension of Tax Credit for Employers Offering Qualified Paid Sick and Family Leave
The bill extends the tax credit relating to qualified paid sick and family leave under the Families First Coronavirus Response Act to March 31, 2021 from the previous December 31, 2020.
The SBA and US Treasury have been given timelines to put out procedures, guidance, forms, etc. to implement the items in this new bill. We will be following the guidance and share with you the “when’s” and “how’s” on taking advantage of these items.