Lawmakers finally ended months of negotiations to agree on a $900 billion Covid stimulus package. The bill is referred to as “The Consolidated Appropriations Act, 2021”. Changes to the PPP program included in the stimulus package include:
- The legislation reverses previous IRS guidance and allows the deduction of expenses covered by PPP loan forgiveness. PPP forgiveness income is still not taxable.
- An additional $284 billion to fund first and second time PPP loans
- Small business owners (300 or fewer employees) will be eligible for a second PPP loan if revenues fell by more than 25% in any 2020 quarter compared to 2019. The maximum amount will be $2 million.
- Simplified forgiveness for PPP Loans under $150,000
We will send out a more detailed analysis in the coming days, but this is certainly welcome relief and assistance for those businesses still struggling.