Last evening, Congress passed legislation that provides more COVID-19 relief to individuals and small businesses. Team GRC obtained an advance copy of the 5,593-page bill and provide you with the following:
Payments to Individuals and Expanded Unemployment Benefits:
Individual Stimulus Payments: Adults and children will be eligible for one-time stimulus payments of $600 per person if the household’s income is less than $75,000 per year or $150,000 for married-couple households and children under 18 years of age. For households with incomes between $75,000 and $99,000, the per-individual amount will be reduced. According to the Treasury Department, direct-deposit payments could start the week of December 27th and mailed paper checks issued later.
Extended Unemployment Assistance have a $300-per-week Federal Add-on: Unemployment assistance from the federal government will be extended from December 26, 2020 to March 14, 2021, from 39 to 50 weeks, with special exceptions and extensions. The federal add-on to state unemployment insurance systems will be reduced to $300 per week from the previous $600 amount.
Relief for Your Businesses and PPP Loans:
First Round PPP Loans prior to August 8, 2020: The legislation provides additional categories of expenses that make larger sums eligible for loan forgiveness. These include payments for personal-protective equipment, improvements to your business premises for COVID-19 mitigation purposes (such as sneeze barriers, drive-through windows, etc.), payments to suppliers, covered property-damage expenses, expanded insurance expenses, and certain operation expenses for software or cloud computing services supporting your business.
Streamlined PPP Loan Forgiveness Requirements: PPP loans of less than $150,000 will be eligible for streamlined forgiveness procedures. Simple certifications replace forgiveness procedures the SBA announced in October 2020. These new reduced requirements apply only to forgiveness applications made after this legislation is passed and signed by the President. They are not retroactive to previously forgiven PPP loans.
Expenses Paid with PPP Loan Proceeds Will Be Eligible for Tax Deductions: Unless your PPP loan was forgiven prior to the enactment of this legislation, the business expenses you paid with those loan proceeds will be deductible from your income taxes. This new deductibility is not applicable on loans already forgiven prior to enactment of this legislation.
Second-Round PPP loans: Congress authorized, but on terms slightly less generous than the first-round loans provided in the CARES Act of March 27, 2020. We will cover these terms and more in the next Update.