The Paycheck Protection Program (PPP) has been one of the most popular programs offered by the Small Business Administration (SBA) to help combat the economic challenges of the pandemic. Since it was implemented as part of the CARES Act, there have been dozens of changes, modifications, and updated regulations published. Concurrently, there have been over 10.7M applications submitted results in over $780B in loans made. More recently, the American Rescue Plan allocated an additional $7.25B and expanded eligibility requirements to include additional nonprofits and government entities. There was also an extension of the application deadline to May 31st to allow additional time to apply. While many expected the PPP to run out of money prior to the deadline, it has come as a surprise PPP funding has been exhausted.
The news came on May 4th that no new applications were being accepted when Denver banks attempted to originate new loans but were denied. This means businesses looking to start a new loan application will not be able to do so. However, women-owned, minority-owned, and other businesses in underserved communities will continue to have access to the $8B set aside until depleted. Those with pending applications are not expected to be impacted.
Unfortunately, the SBA has yet to make an official announcement about the depletion of funding, but it is expected they will do so today. If your company did not apply for a PPP loan, there are still other options to consider such as an Economic Injury Disaster Loan (EIDL). If you have questions about the information outlined above or need assistance with a tax or accounting issue, Hanson & Co can help. For additional information call us at 303-388-1010 or click here to contact us. We look forward to speaking with you soon.