COVID-19 Relief Updates: Application guidance for PPP and SVOG
This week, the U.S Small Business Administration (SBA) released updated guidance on applying to their two key programs, the Paycheck Protection Program (PPP) and the Shuttered Venue Operators Grant (SVOG). Read below for more information on PPP application for schedule C filers and the preliminary application checklist for SVOG applicants.
The deadline for both first and second draw applicants has been extended to May 31st, 2021. As part of the extension, the SBA will have 30 days after the May 31st deadline to process pending applications.
The SBA has released updated guidance for PPP Loan Calculations to allow individuals who file an IRS Form 1040, Schedule C to calculate their maximum PPP loan amount using gross income rather than net income. Gross income and net income are reflected on Schedule C line 7 and line 31, respectively.
This change is relevant to small business Schedule C filers including Sole Proprietors, Independent Contractors and Self-Employed Individuals, enabling them to receive more financial support for new first and second draw submissions. SBA is implementing this change for PPP loans approved after the effective date of this PPP Interim Final Rule - Revisions to Loan Amount Calculation & Eligibility, meaning that a borrower whose PPP loan was already approved can’t increase its PPP loan amount based on the new calculation methodology.
To ensure your business’s application is processed, complete and submit the relevant document(s) below:
First Draw Borrower Application (SBA Form 2483)
Second Draw Borrower Application (SBA Form 2483-SD)
First Draw Borrower Application for Schedule C Filers Using Gross Income (SBA Form 2483-C)
Second Draw Borrower Application for Schedule C Filers Using Gross Income (SBA Form 2483-SD-C)
Applicants who choose the gross income loan amount calculation option must complete either SBA Form 2483-C or SBA Form 2483-SD-C referenced above. For further information, please review the SBA’s updated PPP FAQ document and of course contact a Pace SBDC Business Advisor to discuss your business concerns.
Shuttered Venue Operators Grant Updates
The US Small Business Administration (SBA) has also provided additional guidance and materials for businesses that may apply for the Shuttered Venue Operators Grant Program (SVOG).
While an application is not yet available, the SBA has released a Preliminary Application Checklist for potential applicants. This checklist specifies required background documents (e.g. corporate structure, employee list), financial documents (e.g. 2019 tax return and 2020 tax return, if filed; financial statements), qualifying-industry specific documents and forms to be compiled.
The SBA has also released a helpful SVOG Eligibility Requirements chart that references general program requirements as well as those specific to particular eligible business types. We recommend you review this as well as the updated SVOG FAQ document.
As of 3/11/2021, businesses that applied for a PPP loan after Dec. 27, 2020 can also apply for an SVOG, with the eligible entity’s SVOG to be reduced by the PPP loan amount. This change was made thanks to new funding provided by the American Rescue Plan Act. You can also check our earlier SVOG blogpost for more program details.
Check out our coronavirus resources page for additional information and contact a Pace SBDC Business Advisor to meet 1:1 and learn more about your business’s relief options.
Comments