• Key deductibility issues from the first round of PPP Loans resolved
  • Full breakdown of the new budget, loan terms, eligibility, and forgiveness
  • How your small business will benefit from the loan

It’s a sigh of COVID-19 relief for small business owners across the country. On Sunday night, President Trump signed into law a new relief package, which includes a revival of the Payroll Protection Program.

An even greater relief—after months of debate between the IRS and the AICPA—PPP2 will allow for tax deductibility of expenses paid for with PPP loan monies. The bill states: “No deduction shall be denied, no tax attribute shall be reduced, and no basis increase shall be denied, by reason of the exclusion from gross income provided.”

Here are the major highlights:

$325 BILLION SMALL BUSINESS AID

  • $284 billion to the SBA for PPP Loans
  • $20 billion to EIDL Grants
  • $15 billion to aid live venues such as concert halls, movie theatres,
  • $12 billion to businesses in low-income communities

ELIGIBILITY FOR PREVIOUS LOAN RECIPIENTS

  • 300 or fewer employees
  • Will have spent full amount of the first loan prior to receiving second
  • Must show a 25% decrease in gross revenue in any quarter of 2020 (compared to that of 2019)
  • Maximum amount for second draw is $2 million

ELIGIBILITY FOR FIRST-TIME BORROWERS

  • Businesses 500 or fewer employees
  • Sole proprietors and other such eligible independent and self-employed individuals
  • Not-for-profits, including religious organizations
  • Food service operations with 300 or fewer employees per location

ELIGIBLE COSTS

  • Payroll
  • Rent
  • Covered mortgage interest
  • Utilities

POTENTIALLY FORGIVABLE EXPENSES

  • Costs incurred from modifications for COVID-19 safety guidelines (including personal protective equipment like masks, sanitizers, plastic shields, etc.)
  • Operating costs including software, digital cloud services, etc.

DSJCPA IS HERE TO HELP. Our team of experts is here to help you and your small businesses tackle these challenges, together. From loan applications to forgiveness, our Coronavirus Response Team (CRT) is ready to see your business through. Visit our website and our COVID-19 Information Center to learn more and stay up to date.

Sincerely,

Devin McQuillan
Associate, Creative Solutions

Contact:
516-541-6549 | Email

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