Following the $2 trillion CARES Act that was passed in March 2020, congress approved a $900 billion COVID-Relief package back on December 21, 2020, also known as the “Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act”. It makes available approximately $284.5 billion in new Paycheck Protection Program (PPP) funding and reopens the PPP for initial and second round loans to nonprofit organizations.
501(c)(3) and 501(c)(6) nonprofit organizations are eligible for the second round of PPP loans. To be eligible for up to $2 million of the second round of PPP, organizations must meet the following criteria:
Your organization can apply for loans up to 2.5 times your average monthly payroll costs for the 12 months before applying. That includes calendar years 2019 or 2020. There is a cap of $10 million for the first draw PPP Loan and a $2 million cap for the second draw. Payroll costs are capped at $100,000 per year, per employee.
You are required to complete the Paycheck Protection Program Round 2 Loan application and submit the application with the supporting documentation to an approved lender. Application forms are available on the SBA website at www.sba.gov or click here to access the second-draw application.
You are required to certify on the Paycheck Protection Program loan application that current economic uncertainty makes the loan request necessary to support your ongoing operations.
Applications will be accepted through March 31, 2021, or until funds for the program are exhausted, whichever comes first.
Your organization can wait until after you submit your forgiveness application and the SBA pays the forgiveness amount to the lender. You have 10 months from the end of your covered loan period to submit your forgiveness application. If you do not submit your forgiveness application within the allowed time, you will have to start making payments on the loan.
To be eligible for loan forgiveness, your organization must meet the following criteria:
If your organization borrows up to $150,000, you will need to fill out and submit the PPP loan forgiveness application, known as the PPP Loan Forgiveness Form 3508-S. Click Here to download. You are required to attest that you accurately completed the application and complied with PPP loan provisions.
For borrowers of loans exceeding $150,000, you are required to use the long form PPP Loan Forgiveness Form 3508 or Form 3508-EZ. Click Here to download. If your organization is eligible to submit Form 3508-EZ, you must meet the following requirements:
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