SBA Extends and Expands PPP Loan Funding

January 15, 2021

If your business cash flow needs a boost to get you through the COVID-19 crisis, take another look at the Paycheck Protection Plan (PPP) loans. For those companies who may have missed out in 2020, the SBA is re-opening the program from now through March 31, 2021. And, if you already took advantage of the first round of PPP loans, you may be eligible for a Second Draw (informally known as PPP2).

SBA has re-opened the First Draw PPP for first-time borrowers. Key points include:

  • Loan amount is based on 2.5 times average eligible monthly payroll costs.
  • The business must have fewer than 500 employees.
  • Loan is capped at $5 million.

The 2021 Consolidated Appropriations Act established Second Draw PPP loans for certain businesses. Key points include:

  • Borrower must have received a First Draw PPP loan and all funds were spent on eligible costs.
  • Borrower must have experienced at least a 25% decrease in revenues for at least one calendar quarter of 2020 as compared to the same quarter in 2019.
  • Loan eligibility is increased to 3.5 times average monthly payroll costs for businesses in the Accommodation and Food Services sector (NAICS 72).
  • The business must have fewer than 300 employees.
  • Loan is capped at $2 million.

In addition, borrowers of both types of loans must certify that “current economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” The loan funds must be used for payroll costs (at least 60% of total) and other eligible expenses (rent, mortgage interest, utilities, worker protection, and other costs). Loans under both programs are eligible for full forgiveness if the funds are used on eligible costs over an 8- to 24-week from the date of the loan.

Banks are not expecting there to be a shortage of funds available, but you will want to apply as soon as possible in order to receive the funds you need for your business. For your convenience we have linked the Borrower Application Form for First Draw PPP and the Second Draw Borrower Application Form.

Our team has the expertise to help guide you on your financial accounting journey. Please reach out to Marty Fox ( if we can help you get started with your application — and count on us to continue to bring you the latest PPP news.



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(209) 527-4220