Two Week Period Where Only Businesses With
Less Than 20 Employees Can Apply For PPP Commences 2/24

COVID-19 Business Update

The Biden administration has instituted a two-week period starting Wednesday, February 24th  during which only businesses with fewer than 20 employees will be able to apply for Paycheck Protection Program (PPP) loans.

The administration said the 14-day exclusive application period is designed to help the 98% of small businesses that have fewer than 20 employees. Noting that these businesses often struggle more than larger businesses to collect the necessary paperwork and secure a PPP loan through a lender, the statement said that the targeted application window will free up lenders to focus on serving these smallest businesses.

The exclusive application window is one of several moves the White House said it is making to further target the PPP to the smallest businesses. The administration also will:

  • Change the PPP loan calculation formula to help sole proprietors, independent contractors, and self-employed individuals receive more financial support. In addition, $1 billion will be set aside for businesses in this category that don’t have employees and are located in low- and moderate-income areas. Details of the changes have not yet been released.
  • Eliminate a restriction preventing small business owners with prior nonfraud felony convictions from obtaining relief through the PPP.
  • Remove a rule preventing small business owners who are delinquent on federal student loan payments from securing a PPP loan.
  • Allow noncitizen small business owners who are lawful U.S. residents to use individual taxpayer identification numbers (ITINs) to apply for relief.

PPP loans have been approved for a total of $40 billion from January 11 through February 21. The application window for the current, $284 billion iteration of PPP is scheduled to close March 31.

The information presented here should not be construed as legal, tax, accounting, or valuation advice. No one should act on such information without appropriate professional advice and after a thorough examination of the particular situation.