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PPP Loans Round 2

When can I apply?

Wednesday, January 13th applications open for all businesses.

What do you advise?

TH3 CPA PPP Loan Guidance- Round 2 (1)
Download P • 85KB


  • Ensure you are eligible. See below for more details. You must have a 25% reduction of income in at least one quarter for 2020 vs. 2019. (Please let us know if you’d like us to check this for you or you can run it yourself)

  • Go through the same lender. They already have much of your information and most likely will not need the same amount of documentation.The loan amount will likely be EXACTLY the same as the first PPP loan amount as the lookback period (2019) is the same unless you choose to use your average monthly payroll for 2020 which the SBA said is acceptable. Most businesses average monthly payroll will be less in 2020 than 2019 if they were affected by COVID-19 restrictions.

  • Check with your lender. Ask them about the application process, timing, and requirements

  • Gather documents. You will need a profit and loss statement proving the 25% reduction in income for a quarter in 2020 vs. 2019. Before gathering additional documents, know what your lender is requiring.

  • Apply for the 2nd round of PPP Loan Funds.

Am I Eligible?

Businesses who meet the conditions will be eligible for the second round of PPP Loan beginning tomorrow, January 13th. There are some conditions:

  • 300 or fewer employees

  • Your business was operational before February 15, 2020 and remains operational.

  • Used or will use the full amount of the first PPP loan on or before the expected date for the second PPP loan.

  • Experienced a reduction of 25% or more in all or part of gross receipts (income) in the 1st, 2nd, or 3rd 2020 quarter compared with the same quarter in 2019.

    • For example if your business income was down 25% or more from April-June of 2020 (compared to 2019), the business is eligible for the second round.

What Do I Need to Apply?

  • Proof of 25% reduction in income from any quarter in 2020 vs. the same quarter in 2019.

  • The lookback period to determine the eligible loan amount will be exactly the same as the first round. For most businesses that will be 2019, however, the SBA is allowing you to use your 2020 average monthly payroll instead of 2019.

    • Most businesses who would be eligible for the loan likely had less average monthly payroll in 2020 but if you think it could be close, it’s worth running the numbers.

Loan Forgiveness*

PPP borrowers can have their first- and second-draw loans forgiven if the funds are used on eligible costs. As with the first round of the PPP, the costs eligible for loan forgiveness in the revised PPP include payroll, rent, covered mortgage interest, and utilities. In addition, the following costs are now eligible:

  • Covered worker protection and facility modification expenditures, including personal protective equipment, to comply with COVID-19 federal health and safety guidelines.

  • Covered property damage costs related to property damage and vandalism or looting due to public disturbances in 2020 that were not covered by insurance or other compensation.

  • Expenditures to suppliers that are essential at the time of purchase to the recipient’s current operations.

  • Covered operating expenditures, which refer to payments for any business software or cloud computing service that facilitates business operations; product or service delivery; the processing, payment, or tracking of payroll expenses; human resources; sales and billing functions; or accounting or tracking of supplies, inventory, records, and expenses.

To be eligible for full loan forgiveness, PPP borrowers will have to spend no less than 60% of the funds on payroll over a covered period between eight or 24 weeks.

Additional Links/resources

*Revised from the Journal of Accountancy


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