By SEMA Washington, D.C., Staff
SEMA has joined scores of other organizations representing millions of American small businesses in urging the U.S. Congress to extend the Paycheck Protection Program (PPP). The current deadline for filing PPP applications is March 31, 2021.
A bill has been passed by the U.S. House of Representatives and sent to the Senate to extend the program through May 31, with an extra 30-day period for the SBA to process applications. Although significant PPP funds remain available—for loans that are potentially forgivable under the guidelines—some lenders have stopped accepting new loan applications.
PPP loans are government funds provided through banks and other lending institutions. Loan amounts generally equal the average of one month’s payroll multiplied by 2.5. The maximum amount for a first loan is $10 million. The maximum amount for a second loan is $2 million (and $10 million for a combined first and second loan). PPP funds can be used to cover payroll, mortgage interest, rent, utilities and other costs. Loans are fully forgivable if at least 60% of loan proceeds are used on payroll costs (i.e., wages, payroll taxes, paid leave, healthcare payments, retirement, and insurance contributions).
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