Updated 12 January 2021 – There is a great deal to unpack about the Stimulus package (Consolidated Appropriations Act, 2021). This summary from the House Small Business Committee is an excellent place to start. Full text of the bill can be read here. We have also linked to some specific relevant articles below.  We are continuing to update this post daily.

• The EDC has assembled a work-in-progress list of participating PPP lenders and their web landing pages:

https://www.sanjuansedc.org/ppp-jan2021-financial-institutions/

• SBA has released detailed information on first-time PPP applications and second-draw applications.

• SBA has released the PPP lender application form, you can use this to determine what information your lender will need from you in order to apply.

• SBA has also released applications to be used for first-time/first-draw PPP applicants and second-draw applicants.

1/11/21 – The SBDC slide deck from the 1/8 presentation is available at the link below:

010821_SBAProgramsAndPPP

Highlights of the bill include:

• $600 one-time stimulus payment for adults making up to $75K/yr ($1200 for a couple up to $150K) plus $600 per dependent child under 17, via direct deposit as was the case previously. You can track your payment at irs.gov/getmypayment

• 12/31 – SBA has released this section-by-section breakdown on the new PPP: https://www.sanjuansedc.org/123020_sba_ppp2_section-by-section/

• PPP: allows deductions for otherwise deductible expenses paid with a forgiven PPP loan

• PPP: $284BN in funding for another round of PPP, which will also be available to businesses that need a 2nd tranche of funding and can show revenue losses of at least 25%, have fewer than 300 employees, and have used or will use the full amount  of their first PPP loan.  There are additional new forgivable expenses specifically for restaurants including PPE, software, and supplier costs.  See the full text of the summary for details.  Restaurants, bars and hospitality (whose NAICS codes start with 72) will be allowed loans of 3.5x monthly payroll; all other businesses will be 2.5x months as with the previous rounds.

• PPP: To be eligible for full loan forgiveness for this new round, PPP borrowers will have to spend no less than 60% of the funds on payroll over a covered period of either eight or 24 weeks.

• PPP:  the bill repeals the requirement that PPP borrowers deduct the amount of any EIDL advance from their PPP forgiveness amount.

• PPP: specific 501(c)6 organizations are now eligible.

more PPP details can be found here.

• EIDL: reintroduces the EIDG advance grant, targeting the up-to-$10,000 advance to low-income communities (*we are awaiting guidance from SBA if the definition of low-income communities includes any parts of San Juan County) to ensure continuity, adaptation, and resiliency; permit small businesses in low-income communities that received an EIDL advance to receive additional funds, up to $10,000; extend covered period for emergency EIDL grants through December 31, 2021;

• Employee Retention Tax Credit would be extended through July 1, 2021. The bill would increase the fully refundable portion of qualified wages from 50% to 70%, among other changes.  It also greatly expands the ERTC in 2021, with the new ERTC credit offering a maximum of $14,000 per employee through June 30, 2021. Originally, the CARES Act only allowed businesses to choose PPP or ERTC. Businesses should take these major changes into account for year-end tax planning purposes and start using it to help them plan out 2021. If a business used and exhausted a PPP loan early in 2020, for example, they could then use the ERTC to help them with their 2020 taxes. You now have the opportunity before the end of the year to claim that tax credit and look back at prior quarters and count those wages. Any wages upon which an ERC is computed, however, would not be forgivable costs under the PPP program.

• Venues (1/5/21): The Grants for Shuttered Venue Operators Bill—also known as the Save Our Stages Bill —  allows independent entertainment businesses, like music venues and movie theaters, along with other cultural entities, to apply for grants from the Small Business Administration to support six months of payments to employees and for costs including rent, utilities and maintenance. Applicants must have lost at least 25 percent of their revenue to qualify, and those that have lost more than 90 percent will be able to apply first, within the first two weeks after the bill becomes law.  For more details go here and here— we will update when an application portal for this grant program becomes available.

• Local Newspapers, TV, and Radio: The second round of PPP loans is open to many media outlets that weren’t eligible for the first round of loans, including outlets owned by out-of-state companies.

• FFCRA: extends employer tax credits for providing both paid sick leave and paid family and medical leave under the Families First Coronavirus Response Act through March 21, 2021

• UI / ESD:  The legislation changed and extended Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC), including an additional $300 per week for all eligible claimants for 10 weeks, from 1/3/21 to 3/13/21. The additional $300 should start being paid 1/15 to claimants who are eligible for benefits, retroactive to w/ending 1/2.

Those on PUA as of March 14 can claim through April 5; extending the maximum number of weeks from 39 to 50.

12/28 – due to the bill not being signed until 12/28, WA ESD is paying eligible PUA recipients $55o to cover what would be 2 weeks of missed payments.  PEUC and regular UI recipients are able to apply for Extended Benefits in their eservices account as of 12/27 or prior.

12/29 – Claimants don’t need to click the new alert to apply for a PUA claim, but it’s not a problem if you did. Because the new federal stimulus was signed into law after PUA & PEUC expired, it created some confusion in the computer system. Continue to submit your weekly claims as usual. The link will go away when we update the system. More Q&A: esd.wa.gov/newsroom/covid-19-worker-information

 The bill also provides an extra benefit of $100 per week for certain workers who have both wage and self-employment income but whose base UI benefit calculation doesn’t take their self-employment into account.

Please let your affected employees know not to call ESD to ask about these extended benefits – claimants will see updates and instructions in their eservices inlbox, or via email or postal mail, as soon as ESD has implemented the new benefits.

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More details will be posted as SBA and Treasury make their deployment plans and timelines public. We encourage you to discuss these changes with your tax professional and CPA in the coming days.