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Small Business Administration Paycheck Protection Program (PPP)


Congress has passed the “Consolidated Appropriations Act, 2021” which includes many provisions to assist small businesses, including an expansion of the Paycheck Protection Program (PPP). Small businesses are the foundation of our community and as a community trusted financial institution, CorePlus Credit Union is here to support our small businesses during this unprecedented time. If you are a Small Business Owner who needs financial support to keep your employees on your payroll during the shutdown, you can apply for the SBA’s Paycheck Protection Program (PPP) and we will be here to talk you through the process from start to finish.  We will continue to update and summarize changes as they become available.  Please check back on this webpage often.

For any questions please contact Selina Moriarty, our Assistant Vice President of Consumer Lending, at [email protected]

 

PPP ROUND 3 (ALSO BEING CALLED “PPP 2ND DRAW”)

The SBA is in the process of finalizing processes, rules and guidelines, which are expected within the next few weeks. This is all subject to change.

  • A 2nd PPP loan is reserved for companies with 300 or fewer employees and is limited to a maximum loan amount of $2MM.
  • The loan calculation is based on 2.5X the company’s average monthly payroll for 2019. Businesses in the Accommodation and Food Services Sector (NAICS code beginning with 72) may borrow 3.5X their average payroll for 2019.
  • A business needs to demonstrate their sales were down 25% in any quarter of 2020 compared to the same quarter in 2019.
  • While the ratio of payroll to eligible expenses will remain the same (60% of the loan proceeds need to be used for payroll and 40% for other qualified expenses)
    • Utilities
    • Rent/mortgage interest
    • Acquisition of PPE
    • Reconfiguration of venue to accommodate CDC guidelines, etc.
    • Damage due to Social Unrest
  • The business has to have been established before 2/15/2020.
  • A borrower does not need to have their first PPP loan forgiven to apply for a new PPP loan. A borrower has to certify that they used all the proceeds or will have used all the proceeds of their first PPP loan on eligible expenses.

For additional PPP resources from the SBA, please visit:
https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program

For additional COVID-19 resources from the SBA, please visit:
https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources</a

CHANGES TO FORGIVENESS IN THE “CONSOLIDATED APPROPRIATIONS ACT, 2021” (STILL BEING IMPLEMENTED BY SBA/DEPT OF THE TREASURY):

  • Existing and future PPP loans under $150,000 will have a simplified forgiveness process similar to the current under $50k 3508s streamlined process[RE1] . SBA is still in the process of developing a new application and instructions.
  • EIDL advances will no longer be subtracted from the forgiveness of the PPP loan. If you had already received forgiveness and had the EIDL advance subtracted, this obligation will be extinguished. We are awaiting SBA guidance on the process of extinguishing these obligations. If you were/are affected by this, we will be contacting you individually when we have more information.
  • A borrower can now elect their own covered period and does not have to choose between 8 and 24 weeks.
  • The Bill appears to clarify the following tax implications of PPP:
    • The forgiven debt is not taxable.
    • If you had an existing SBA loan upon which the SBA made payments on your behalf, those payments are not taxable.
    • All expenses covered by the loan proceeds are tax-deductible.

(Borrowers should consult with their Tax Advisor for details)

PLEASE READ CAREFULLY
BEFORE YOU APPLY.

In order to process your application, you must answer the question below. Questions answered dishonestly will result in your application being denied.

 

 

 

Are you a current member of CorePlus Credit Union or do you live, work, or worship in New London County, Connecticut or Windham County, Connecticut?