How Does the PPP Change in 2021?


What is PPP?

PPP stands for “The Paycheck Protection Program”. It is a program that was created by the federal government in 2020 in response to the COVID-19 pandemic and its impact on the US economy and its small businesses. The PPP program is aimed at assisting mostly small businesses to maintain their workforce on payroll by providing loans to help cover those payroll expenses. 

To date, there are two open “Draws” of the PPP loan, both of which remain available to small businesses until end of March, 2021. It is possible to borrow up to 2.5 times the average 2019 or 2020 payroll costs that go up to $2 million. The average loan so far has been $73,000 to a given business.  

What Are the New Changes to PPP?

(1) A special window of 14 days, designed to help exclusively the smallest borrowers that have no more than 20 employees, has been opened for those businesses to use, during which only their PPP applications will be processed. This change will allow a greater number of the most vulnerable businesses, including women and minority-owned to take advantage of the loan opportunity at the very beginning of the draw cycle. This exclusivity period will last until March 9, 2021. 

(2) The PPP application process has also been simplified for self-employed individuals, independent contractors as well as sole proprietors of businesses, now allowing them to use their gross income line on the Schedule C of their tax forms. 

(3) The loan application will no longer not take into account the potential borrower’s federal student loan delinquency status, as was previously the case, allowing for more eligible candidates to receive the loan.  

(4) The government will now allow those immigrant business owners who lawfully reside in the US and pay taxes, to use their ITIN numbers on their PPP applications, which will facilitate the loan process for them as well. 

The PPP application process will last until March 31, 2021. All necessary forms and documents that are needed to begin the application can be found on the U.S. Small Business Administration’s website. Once you are a matched with a lender in your area, the lender will guide you through the application process further. You can also monitor the status of your application on the SBA’s website.  

EPGD Business Law is located in beautiful Coral Gables, West Palm Beach and historic Washington D.C. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.

*Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns. Contacting us through our website does not establish an attorney-client relationship.*

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Eric Gros-Dubois

Eric P. Gros-Dubois founded EPGD Business Law in 2013 and is the current head of the firm’s corporate, estate planning, and tax practice, and manages the firm’s Washington D.C. office. With a JD and MBA, and a specialization in finance, Eric is able to step back and view the legal world through a commercial lens while also acting as a trusted business advisor for his clients. He does his best to be solutions oriented, and tries to think like a business owner, not just a lawyer.


*The following comments are not intended to be treated as legal advice. The answer to your question is limited to the basic facts presented. Additional details may heavily alter our assessment and change the answer provided. For a more thorough review of your question please contact our office for a consultation.

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