WASHINGTON, DC — This week, the House passed bipartisan legislation cosponsored by U.S. Congressman Josh Gottheimer to give North Jersey small businesses more time to apply for the forgivable loans from the U.S. Small Business Administration’s Paycheck Protection Program (PPP). Currently, the deadline for application to this critical relief program is March 31, 2021 — less than two weeks away.
The new bipartisan PPP Extension Act of 2021 would extend the deadline for application to May 31, 2021 — two extra months.
Thus far, the Paycheck Protection Program has provided more than 71,000 forgivable loans to New Jersey small businesses, helping Garden State employers and their workers stay afloat.
“Small businesses and their workers are the backbone of North Jersey and they desperately need our support,” Gottheimer (NJ-5) said. “It’s great to see the House pass this bipartisan bill that I was proud to cosponsor, which extends the deadline to apply for PPP by two more months — giving more of our small businesses the time they need to take advantage of this relief. Now, the Senate needs to quickly pass this bill so it can be signed into law as soon as possible.”
Gottheimer helped lead the bipartisan, bicameral COVID-19 emergency relief package in December 2020, which included $325 billion for a second round of loans from PPP and other small business support. Gottheimer also helped pass the new COVID-19 relief package this March, which has now been signed into law and includes an additional $7.25 billion for PPP, $28.66 billion for a new SBA restaurant grant program called the Restaurant Revitalization Fund, $1.25 billion in grants for shuttered live venue operators, and $15 billion in new funding for Targeted EIDL grants.
Information for First Draw and Second Draw PPP Loans:
First Draw PPP Loans: The qualifications for the first draw PPP loans remain the same as in 2020. If you own a small business that did not apply for a PPP loan when they were available in 2020, then you are able to now apply for a forgivable loan if your business was in operation before February 15, 2020, and if you have fewer than 500 employees.
Second Draw PPP Loans: If your small business already received a First Draw PPP loan, that means you could now qualify for a fully-forgivable Second Draw PPP loan if you meet the new criteria. Small businesses can qualify if they have experienced a 25% drop in revenue compared to before the pandemic, if they have fewer than 300 employees, and if the business was operating before February 2020. However, hotels and restaurants with an NAICS code beginning with 72 are exempt from the affiliation rules and may employ 300 or fewer employees per physical location. Businesses must have used, or will use, their First Draw PPP loan funds on eligible expenses before the Second Draw loan is disbursed.
Expenses paid for with PPP loans are tax deductible. Some additional categories of non-profit organizations can now apply for a loan too.
For more information on applying for a PPP loan or the EIDL, visit sba.gov.