Senate Passes PPP Deadline Extension – PPP Extended Until May 31, 2021
On a 72 to 7 vote the Senate has passed the PPP Extension Act of 2021, which extends the PPP Loan Program for another 60 days with a new PPP loan application deadline of May 31, 2021.
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The article in the Journal of Accountancy reads as follows:
“Senate passes PPP deadline extension
A bill to move the Paycheck Protection Program (PPP) application deadline from March 31 to May 31 won approval in the U.S. Senate on Thursday.
The final vote to approve the PPP Extension Act of 2021, H.R. 1799, was 92–7.
There was some drama, however. A measure to amend the bill was narrowly defeated 52–48. The amendment, proposed by Sen. Marco Rubio, R-Fla., would have restricted the U.S. Small Business Administration’s (SBA’s) ability to prioritize certain PPP borrowers over others. If the measure had passed, it could have led to an amended bill having to be sent back for approval to the House of Representatives, which had passed the original bill 415–3 but currently is adjourned.
As it stands, the votes Thursday send the legislation to President Joe Biden for his signature several days before the PPP was set to expire.
The AICPA praised the passage of the PPP Extension Act, which extends the filing deadline for PPP applications by 60 days and provides an additional 30 days for the SBA to finish processing applications received by May 31.
In a news release, the AICPA said that the additional 60 days provided by the bill will greatly help small businesses, not-for-profits, and the CPAs that serve them complete existing PPP loan applications and file new ones. The extension act also provides the SBA time to address significant loan application process challenges, including confusing validation and error codes, delayed guidance, and changes to the PPP loan amount calculation for self-employed borrowers, the AICPA release said.
Patrick Kelley, the associate administrator for the SBA’s Office of Capital Access, testified during a Senate Small Business Committee meeting Wednesday that 190,000 applications were still held up in the SBA’s PPP platform due to unresolved error codes related to validation checks instituted by the SBA to help prevent fraudulent applications from being funded.
The PPP Extension Act does not provide any additional funding for the current round of the PPP, which Congress provided with more than $290 billion to make forgivable loans to small businesses and not-for-profits. From the program’s opening on Jan. 11 through March 21, the SBA has approved more than 3.1 million loans totaling nearly $196 billion. In his testimony Wednesday, Kelley said that at the current lending rate, the PPP should have enough funding to last through mid-April.”
Source – https://www.journalofaccountancy.com/…
The good news, the PPP program apparently is going to be extended for another 60 days. That’s what we’re going to talk about in this video. Hello from Freedom Tax Accounting, we’re an accounting firm where we have been providing quality tax and accounting services now for over 20 years. If you’re new to this channel we provide strategies for small business owners, so they can achieve their financial goals. Although for the last couple of months, we have been concentrating on providing information on the PPP and EIDL loan programs.
Now today is March 25h and we always emphasize the date of the recording on any video relating to the PPP program because this PPP loan has been constantly changing. So, there may be things we discussed in this video that can change as soon as tomorrow, so that’s the importance of subscribing to our channel that way you’re always up to date with the most current and correct information regarding these loans.
So, what happened today? Let me show you this directly from the congress website the PPP extension act of 2021 has just passed in the Senate in a vote of 92 to 7. So, an almost unanimous vote. If you have been following the PPP loan program news, last week the house of representatives voted on extending the PPP loan program in a 415 to 3 vote. Now that has gone to the senate and it has passed in a 92-7 vote. So, now it will quickly go to the president’s desk, and I’m pretty sure that it’s going to be signed by the president and become law pretty soon, which is on time because the PPP loan program was supposed to end on March 31st.
Now, what’s the extension? The extension is that the PPP loan program has been extended for 60 days meaning it has been extended to May 31st. Now the good thing is that compared to other extensions in the past, for example, the last deadline in 2020 was August 8th and now the new deadline for 2021 was supposed to be March 31st, and in these two past deadlines, you had to have an approved PPP loan by that date. So, it did not mean that you submitted your application before that date it meant that for example, by March 31st you had to have an approved PPP loan by that date. When you start the PPP loan application process the process can take two to three weeks, and that’s why for the last couple of weeks most banks basically closed their PPP application portals because they said, “Well if we need a PPP loan approved by March 31st, we’re going to we’ll we will not take any more applications maybe two to three weeks before, so that didn’t make a lot of sense to us. So, at least this time it’s a little different because now it’s May 31st the deadline to submit an application because after May 31st the SBA has an additional submitted PPP loan application, so I think that’s pretty good news now.
So, the good news is that PPP has been extended so all of you have to have not applied for PPP1 or PPP2. You have more time now to apply.
Now the question all of us have is what’s going to happen for the self-employed independent contractors, single-member LLCs, basically every business that files a schedule C and gets a PPP loan, will they be able to reapply and get a larger amount based on the new PPP loan formula? As of this date, no. So, as of today March 26th, 6 PM Orlando Florida time, the SBA still has not provided a way where schedule C filers who got a PPP1 or a PPP2 based on the old formula that was based on line 31, net profit, they’re not able to reapply and get an increase on their PPP loan based on the new formula that’s online seven the gross income. We were expecting that to be included in this bill in congress but that was not included.
So, once again, we feel that at some point in the future the SBA will provide a way for schedule C fighters to reapply and get the difference, and maybe now that they have extended the program for another 60 days, they may now come out with some guidance and a way for these schedule C filers to get the difference but we will have to wait okay. But for now, the news is the senate just passed the PPP extension act and the PPP now is just waiting for the president to sign it to make it official, which I’m pretty sure is going to be signed either today or tomorrow. So, now if you haven’t filed PPP now you have more time, go ahead and apply okay.
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