Subsection (c)(2) of the IFR defines gross receipts consistent with the definition of receipts in 13 CFR 121.104 of SBA's size regulations because this definition appropriately captures the type of income that is typically included in a small business's gross receipts. (1) The applicant must submit to the lender SBA Form 2483-SD (Paycheck Protection Program Second Draw Borrower Application Form) or the lender's equivalent form including the required certifications and the documentation in subsection (g)(2). Second draw PPP loans now available If your business received a PPP loan in 2020 and have already exhausted that funding, you may be able to apply for second PPP loan if: Your business has fewer than 300 employees You have exhausted all funds obtained from a previous PPP loan. electronic version on GPOs govinfo.gov. (ii) that retains, as a member of the board of directors of the business concern, a person who is a resident of the People's Republic of China; (4) any person required to submit a registration statement under section 2 of the Foreign Agents Registration Act of 1938 (22 U.S.C. This interim final rule is economically significant for the purposes of Executive Orders 12866 and 13563, and the Office of Management and Budget's Office of Information and Regulatory Affairs (OIRA) had determined that this is a major rule under the Congressional Review Act (5 U.S.C. without regard for whether such a station is a concern as defined in 13 CFR 121.105, or any successor thereto) that employs not more than 300 employees, per physical location of such business concern and is majority owned or controlled by a business concern that is assigned a NAICS code beginning with 511110 or 5151; or. Finally, subsection (f)(9) provides that businesses that are part of a single corporate group shall in no event receive more than $4,000,000 of Second Draw PPP Loans in the aggregate. (v) For loans with a principal amount of $150,000 or less, the applicant must submit documentation sufficient to establish that the applicant experienced a reduction in revenue as provided in subsection (c)(1)(i) of this section at the time of application, on or before the date the borrower submits an application for loan forgiveness, or, if the borrower does not apply for loan forgiveness, at SBA's request. (4) A lender must submit SBA Form 2484-SD (Paycheck Protection Program Lender's ApplicationSecond Draw Loan Guaranty) electronically in accordance with program requirements and maintain the forms and supporting documentation in its files. For second draw loans, the bill appears to exclude from eligibility borrowers that previously qualified as a "small business concern" under the "alternative size standard" or the borrower's NAICS Code. Subsection (i) of the IFR establishes procedures relating to the handling of a Second Draw PPP Loan application by a borrower whose First Draw PPP Loan is under review by SBA (unresolved borrower). The Public Inspection page These include but are not limited to: The SBA guaranteeing 100%. An updated PPP application form has been issued by the SBA, together with an application for the new Second Draw Loan program. (C) The gross receipts of a former affiliate are not included. 10. (iii) If a borrower meeting the criteria in subsection (6)(i) of this section has employees, the maximum loan amount is calculated as the lesser of: (1) The sum of (i) the difference between gross income and employee payroll costs of the borrower in 2019 or 2020 (at the election of the borrower), as reported on a Schedule F (IRS Form 1040), that is not more than $100,000, divided by 12, and (ii) the average total monthly payment for employee payroll costs incurred or paid by the borrower during the same year elected by the borrower; by. (E) Follow applicable BSA requirements (listed in subsection (C)(3)(d) of the Consolidated First Draw PPP IFR); and. 17. 1602), including any entity that is organized for research or for engaging in advocacy in areas such as public policy or political strategy or Start Printed Page 3719otherwise describes itself as a think tank in any public documents; (i) For which an entity created in or organized under the laws of the People's Republic of China or the Special Administrative Region of Hong Kong, or that has significant operations in the People's Republic of China or the Special Administrative Region of Hong Kong, owns or holds, directly or indirectly, not less than 20 percent of the economic interest of the business concern or entity, including as equity shares or a capital or profit interest in a limited liability company or partnership; or. SBA has requested emergency approval for the IC required to implement the Second Draw PPP Program described above. A borrower's average monthly payroll costs may be based on calendar year 2020, calendar year 2019,[36] documents in the last year, 881 Eligible employers can claim a tax credit equal to 50% of qualifying wages (defined as wages plus the cost of employer-provided healthcare up to $10,000 per employee) paid between March 13, 2020, and December 31, 2020. The key differences between First Draw PPP Loans and Second Draw PPP Loans are described in this IFR, which explains the loan terms, eligibility requirements, and application process for Second Draw PPP Loans. ). Similarly, local municipalities throughout the country will have to deal with revenue loss created by COVID-19. Register documents. For second draw loans, the bill appears to exclude from eligibility borrowers that previously qualified as a "small business concern" under the "alternative size standard" or the borrower's. This is because the SBA is prioritizing the disbursement of second draw loans. Ch.1. These markup elements allow the user to see how the document follows the This IFR also specifies that, in calculating a farmer's or rancher's maximum loan amount, any employee payroll costs should be subtracted from the farmer's or rancher's gross income to avoid double-counting amounts that represent pay to the employees of the farmer or rancher. Draw the structure of the compound identified by the simulated - H NMR and IC NMR spectra. As a result, Nashville's City Council recently approved a significant property tax increase of 34% to make up for the tax losses brought about by COVID-19. Comment Date: Comments must be received on or before February 16, 2021. Information about this document as published in the Federal Register. The President of the United States issues other types of documents, including but not limited to; memoranda, notices, determinations, letters, messages, and orders. 29. mobile apps Subsection (j) contains forgiveness provisions specific to Second Draw PPP loans. More information and documentation can be found in our [17] 7. (A) Confirm receipt of borrower certifications contained in Paycheck Protection Program Second Draw Borrower Application Form (SBA Form 2483-SD) or lender's equivalent; (B) Confirm receipt of information demonstrating that a borrower was either an eligible self-employed individual, independent contractor, or sole proprietorship with no employees or had employees for whom the borrower paid salaries and payroll taxes on or around February 15, 2020; (C) Confirm the dollar amount of average monthly payroll costs for 2019 or 2020 (whichever was used to calculate loan amount) by reviewing the payroll documentation submitted with the borrower's application; (D) For a Second Draw PPP Loan greater than $150,000 or a loan of $150,000 or less where the borrower provides documentation of revenue reduction, confirm the dollar amount and percentage of the borrower's revenue reduction by performing a good faith review, in a reasonable time, of the borrower's calculations and supporting documents concerning the borrower's revenue reduction. See . This article summarizes which businesses are not eligible for First Draw PPP Loans and Second Draw PPP Loans. Paragraph 7(a)(36)(D)(iii)(II) of the Small Business Act. 804(2)). If you are using public inspection listings for legal research, you documents in the last year, 124 [32] (2) The affiliation rules under 13 CFR 121.301(f) are waived with respect to eligibility for a Second Draw PPP Loan for: (i) Any business concern with not more than 300 employees that, as of the date on which the covered loan is disbursed, is assigned a NAICS code beginning with 72; and, (ii) (A) any business concern (including any station which broadcasts pursuant to a license granted by the Federal Communications Commission under title III of the Communications Act of 1934 (47 U.S.C. Section 339 of the Economic Aid Act added calculated on a non-compounding, non-adjustable basis to the maximum interest rate for a PPP loan. (3) SBA will pay lenders fees for processing Second Draw PPP Loans in the following amounts:Start Printed Page 3722. The rule has no preemptive or retroactive effect. SBA will resolve issues related to unresolved borrowers expeditiously. on NARA's archives.gov. Each document posted on the site includes a link to the 2. developer tools pages. The requirement to conduct a regulatory impact analysis does not apply if the head of the agency certifies that the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities. 5 U.S.C. [FR Doc. Since most borrowers will use 2019 or 2020 the rule text refers only to 2019 or 2020 for simplicity and readability. 612); (5) any person or entity that receives a grant for shuttered venue operators under section 324 of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act; (6) any entity in which the President, the Vice President, the head of an Executive department, or a Member of Congress, or the spouse of such person as determined under applicable common law, directly or indirectly holds a controlling interest in the entity, where: (i) controlling interest means owning, controlling, or holding not less than 20 percent, by vote or value, of the outstanding amount of any class of equity interest in an entity; (A) A share in an entity, without regard to whether the share is transferable or classified as stock or anything similar; (B) a capital or profit interest in a limited liability company or partnership; or. edition of the Federal Register. Two distinct Paycheck Protection Programs (PPP) opened on January 19, 2021. Borrowers calculate their average monthly payroll in either 2019, 2020 or their trailing 12 months. This clarification ensures the effectiveness of the second draw loan program by ensuring that a borrower is not disqualified from receiving a Second Draw PPP Loan because it received forgiveness on a First Draw PPP Loan. The local SBA Field Office may be found at https://www.sba.gov/tools/local-assistance/districtoffices. All other comments must be submitted through the Federal eRulemaking Portal described above. We anticipate that this rule will result in substantial benefits to small businesses, their employees, and the communities they serve. 33. Only official editions of the These provisions allow a lender approved to make Second Draw PPP Loans to use existing program guidance and standard operating procedures to the maximum extent practicable. (C) a warrant or right, other than a right to convert, to purchase, sell, or subscribe to a share or interest described in (A) or (B), respectively; (iii) Executive department has the meaning given the term in section 101 of title 5, United States Code; (iv) Member of Congress means a Member of the Senate or House of Representatives, a Delegate to the House of Representatives, and the Resident Commissioner from Puerto Rico; and. The Consolidated Appropriations Act, 2021 contained a $900 billion COVID-19 relief package that, among many other initiatives, reauthorizes and modifies the Paycheck Protection Program. (v) For the purpose of determining whether a person has a controlling interest in the entity, the securities owned, controlled, or held by the President, the Vice President, the head of an Executive department, or a Member of Congress, shall be aggregated with the securities held by his or her spouse as determined under applicable common law; (7) any issuer, the securities of which are listed on an exchange registered as a national securities exchange under section 6 of the Securities Exchange Act of 1934 (15 U.S.C. documents in the last year, 655 A Rule by the Small Business Administration on 01/14/2021. See paragraph 7(a)(37)(O) of the Small Business Act. Section 342 of the Economic Aid Act. The bill, signed into law on Dec. 27, includes a total of $284.5 billion for PPP loans. (3) Any business concern that has more than one physical location and that employs not more than 300 employees per physical location is eligible to receive a Second Draw PPP Loan if it is assigned a NAICS code beginning with 72 at the time of loan disbursement and otherwise meets the eligibility criteria in subsection (c)(1). The Economic Aid Act generally provides that a borrower is eligible for a Second Draw PPP Loan only if it has 300 or fewer employees and experienced a revenue reduction in 2020 relative to 2019 (described further below). The Administrator, in consultation with the Secretary, has determined this provision is also necessary to maintain program integrity, prevent abuse, and preserve the availability of Second Draw PPP Loan funds for businesses still in operation. [11] 04/17/2023, 209 January 14, 2021) and PPP Second Draw Loans (86 FR 3712, January 14, 2021). This repetition of headings to form internal navigation links Second Draw PPP Loans are generally subject to the same terms, conditions and requirements as First Draw PPP Loans. These tools are designed to help you understand the official document The President of the United States manages the operations of the Executive branch of Government through Executive orders. 5 U.S.C. (B) An applicant that was in operation in all four quarters of 2019 is deemed to have experienced the revenue reduction in subsection (c)(1)(iv)(A)(1) if it experienced a reduction in annual receipts of 25 percent or greater in 2020 compared to 2019 and the borrower submits copies of its annual tax forms substantiating the revenue decline. 636(a)(36)) (First Draw PPP Loans) apply to Second Draw PPP Loans, except as otherwise provided in this section. The deadline of May 31, 2021 is the same for both applications. Principally, the Economic Aid Act authorizes further PPP funding and allows prior PPP borrowers to pursue second draw PPP loans. SOPHIE'S WORLD sets out to draw teenagers into the world of Socrates, Descartes, Spinoza, Hegel and all the great philosophers. These include, but are not limited to the following terms: The guarantee percentage is 100 percent. (1) A lender approved to make First Draw PPP Loans may make Second Draw PPP Loans under the same terms and conditions applicable to First Draw PPP Loans, including all requirements under sections (C) and (D) of the Consolidated First Draw PPP IFR, except as otherwise provided in this section. (b) What requirements apply to Second Draw PPP Loans? include documents scheduled for later issues, at the request must make the certifications listed in subsection (B)(12) of the Consolidated First Draw PPP IFR, except: (i) Instead of the certification in subsection (B)(12)(v) of the Consolidated First Draw PPP IFR, the applicant must certify that the applicant has not and will not receive another Second Draw Paycheck Protection Program Loan; and. With an additional $284 billion allocated to the PPP, the Small Business Administration has released initial guidance related to first draw and second draw PPP loans. Certain 2020 first draw PPP loans were flagged with hold codes after SBA review. For loans with a principal amount of $150,000 or less, such documentation is not required at the time the borrower submits its application for a loan, but must be submitted on or before the date the borrower applies for loan forgiveness, as required under the Economic Aid Act. Paragraph 7(a)(37)(F) of the Small Business Act. In addition, as discussed below, under the Consolidated First Draw PPP IFR, SBA's affiliation rules (13 CFR 121.301) do not apply to any business entity that is assigned a NAICS code beginning with 72 and that employs not more than a total of 500 employees. In addition, the SBA has addressed some issues in their guidance. 27. Learn more here. Businesses are eligible for a Second Draw loan if: They previously received a First Draw PPP loan. Under section 7(a)(37) of the Small Business Act (15 U.S.C. Choose Get Payroll Updates. The amount of a PPP loan is approximately equal to 2.5 times the applicant's average monthly payroll costs. In place to avoid making superfluous PPP loan payments, loan must submit loan forgiveness applications to their lenders within 10 months free the end of their respective covered periods. Military procurement has also been omitted, mainly because military procurement contrasts with civic public procurement e.g. However, SBA noted that "lenders that submitted a Second Draw PPP Loan guarantee application before January 27, 2021, that was rejected due to an unresolved issue with the first draw PPP Loan, should resubmit these applications." SBA also issued procedural notices related to various provisions of the most recent COVID-19 relief law. [18] rendition of the daily Federal Register on FederalRegister.gov does not L. 116-136, section 1114; and Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, Pub. No personal guarantees will be required. 636) in section 304(b) of the Economic Aid Act. This IFR clarifies that the same general calculation for farmers and ranchers applicable to First Draw PPP Loans applies to Second Draw PPP Loans, with adjustments that (i) eliminate the provision for refinancing of an Economic Injury Disaster Loan (EIDL), which does not apply to Second Draw PPP Loans, and (ii) apply the choice of time period for calculating a farmer's or rancher's payroll costs for Second Draw PPP Loans, consistent with other Second Draw PPP Loans. A business concern or entity primarily engaged in political activities or lobbying activities, including any entity that is organized for research or for engaging in advocacy in areas such as public policy or political strategy or that describes itself as a think tank in any public documents; certain entities organized under the laws of the People's Republic of China or the Special Administrative Region of Hong Kong, or with other specified ties to the People's Republic of China or the Special Administrative Region of Hong Kong; any person required to submit a registration statement under section 2 of the Foreign Agents Registration Act of 1938 (. For example, a borrower with gross receipts of $50,000 in the second quarter of 2019 and gross receipts of $30,000 in the second quarter of 2020 has experienced a revenue reduction of 40 percent between the quarters, and is therefore eligible for a Second Draw PPP loan (assuming all other eligibility criteria are met). 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