The Senate approved legislation previously approved in the House of Representatives (H.R. 1799) that will extend the final submission date to May 31, 2021
Here is an update just in case you are unaware of the status of SBA PPP loans and EIDL loans.
On April 16, 2020, the Small Business Administration announced that the entire amount designated by Congress for Paycheck Protection Program loans, $349 billion, has been exhausted. Republicans are seeking another $250 billion.
The Small Business Administration also announced that all of the funds allocated by Congress for Economic Injury Disaster Loans have been exhausted. Congress is also negotiating providing more funds for that program.
Companies who received a loan number from their banks for their loans should eventually get funding. Check with your bank.
More than 25% of the funding went to under 2% of the firms that got relief. These companies include at least 60 publicly traded companies with thousands of employees and hundreds of millions of dollars in annual sales.
Shake Shack, Inc., Ruth Hospitality Group Inc. (Ruth’s Chris Steak House), Potbelly Corp. and Fiesta Restaurant Group’s Texas Taco Cabana all borrowed $10 million. (Shake Shack, Inc. has announced it will return its $10 million PPC loan.)
The three biggest state economies – California, Texas and New York – accounted for 23% of the loans. Businesses in small, rural states received a bigger share.
The business sector receiving the most money was construction, with 13% of the total.
The SBA issued new guidelines last Friday (after the limit was already reached) requiring self-employed persons, partnerships and limited liability companies to file their income tax returns before applying for PPP loans. The reason filing the income tax returns is required is to document self-employment income treated as wages. The requirement will penalize companies that haven’t filed their income tax returns yet because of the extended July 15, 2020 due date for 2019 federal income tax returns.