![]() ![]() Are owned or held at least 20% by a Chinese or Hong Kong entity, or.Has “significant operations” in China or Hong Kong, or. ![]() Are organized under the laws of the People’s Republic of China or Hong Kong, or.Second draws of the PPP program are specifically prohibited for businesses that: No public companiesĪfter the sever public outcry against the first round of loans going to public companies, congress took the time to specifically prohibit any business listed on a stock exchange. The act specifically excludes any business concern primarily engaged in political or lobbying activities, including think tanks, research, and advocacy groups. The round of funding does allow for a wide variety of organizations including “any business concern, nonprofit organization, housing cooperative, veterans organization, Tribal business concern, eligible self-employed individual, sole proprietor, independent contractor, or small agricultural cooperative.” No lobbying organizations. This round of funding excludes larger organizations with more than 300 employees. Organizations must have fewer than 300 employees. If your business started in 2019, you’ll have to limit your analysis to just the quarters you existed or, if you were formed in 2020, you’ll have to compare Q2, Q3, and Q4 against 2020 Q1. Revenue is defined on either a cash or accrual basis, whichever is consistent with your bookkeeping. When comparing against the same quarter in 2019, your organization must have experienced at least one 25% reduction of revenue. The following limitations will exist for any entity applying: Organizations must have experienced a 25% reduction in gross receipts for any quarter of 2020. We at CFOshare took a peak at the PPP bill that passed congress December 21st, and here’s the details on what’s coming (for an executive summary, check out our 1-minute article, or check out our webinar) Who can apply for PPP second drawsįewer businesses will qualify for the second round of PPP funding. This may be subject to change.After 2 months of ongoing debate and negotiations, congress and president Trump signed a new stimulus bill which includes a second round of PPP loans. Note: The Economic Aid Act mentions calendar quarters, but the SBA and Treasury Department haven’t confirmed using calendar quarters. If you choose this route, you’re required to submit annual tax forms to support your decline calculation. If your business was in operation during all four quarters of 2019, you can compare total annual receipts in calendar year 2020 to 2019 instead of performing a quarter-by-quarter comparison. There’s an alternative approach to calculating the decline in gross receipts. If you had gross receipts of $50,000 in Q2 2019 and gross receipts of $30,000 in Q2 of 2020, you experienced a 40% revenue reduction. For example, i f you use Q 2 2020, you’ll compare it to Q 2 2019. Generally speaking, you’ll compare the gross receipts from a 2020 quarter to the same quarter in 2019. Reference pages 21-22 of the SBA’s interim final rule to learn more. If you weren’t in operation for all of 2019, your quarter comparisons will differ. Your quarters may change based on when you were in business. You experience at least a 25% reduction in gross receipts from one calendar quarter in 2020 to the same quarter in 2019.You can apply for a second draw loan if you meet the following requirements: Make sure to consider the affiliation rules when evaluating your eligibility for a second draw loan. In general, the same affiliation rules that apply to initial PPP loans apply to second draw loans.
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