COVID-19 Small Business Resource Center

The following types of businesses and entities are eligible for a First Draw PPP Loan:

• Businesses with 500 or fewer employees
• Entities that meet the SBA industry-based size guidelines for small businesses
• Nonprofits, sole proprietorships, self-employed individuals, independent contractors (e.g., gig economy workers) as well as tribal and veteran organizations that meet the above criteria

In order to be eligible for a Second Draw PPP Loan, you must:

• Have previously received a PPP First Draw Loan, and will use, or have used, the full principal amount for approved expenses
• Be able to show proof of 25% or more gross revenue loss from 2019 to 2020
• Have 300 or fewer employees

The maximum amount you can borrow with a PPP Loan is equal to 2.5 times your average monthly payroll costs from 2019 or 2020. Borrowers in the accommodation and food services industries may borrow up to 3.5x the average monthly payroll costs for the same time period. Eligible first-time PPP borrowers may apply for a First Draw PPP Loan up to $10 million. Most small businesses interested in a Second Draw PPP Loan may borrow up to $2 million.

To be eligible for full loan forgiveness, First and Second Draw PPP borrowers must meet the following criteria within 8 to 24 weeks of receiving the loan:

• Loan funds are only used for eligible expenses, including:
  • Payroll costs
  • Operational expenses
  • Supplier costs
  • Worker protection expenses
  • Covered property damage costs
  • Rent, covered utilities or interest on a mortgage (no prepayments)
• A minimum of 60% of the funds are spent on payroll expenses
• Compensation and employee levels are maintained

All PPP borrowers need to apply for forgiveness with each new loan and/or respective lender.

Yes, you can claim normal tax deductions for business expenses covered by both First and Second Draw PPP Loans. This includes business expenses paid for with forgiven PPP Loans, as well as Economic Injury Disaster Loan (EIDL) funds.