Please note: This blog is current to the date of its publication, Wednesday, Feb. 24. For additional updates or assistance navigating these uncertain times, please contact us or visit our SST COVID-19 resource page.
Many small businesses have been experiencing significant issues and delays when trying to apply for Paycheck Protection Program (PPP) forgivable loans. The American Institute of Certified Public Accountants (AICPA) is diligently communicating with the Small Business Administration (SBA) to address and attempt to resolve these issues.
Four areas of concern, explained in this Journal of Accountancy article, include:
- Denial of applications by the SBA E-Tran system due to additional validation checks
- Processing delays for applications successfully submitted to the E-Tran system due to the SBA flagging 20-30% of applications for additional review
- The SBA capping PPP loan amounts at $35,000 per employee on both first and second draw loans
- Overall lack of communication
On Feb. 10, the SBA addressed these concerns and announced changes to improve efficiency, but delays continue.
Earlier this week, the Biden administration announced that it will institute a two-week period, starting on Feb. 24, during which only businesses with 20 or fewer employees will be able to apply for PPP loans.
Other newly announced initiatives include:
- Help for sole proprietors, independent contractors and self-employed individuals needing additional financial support
- Elimination of exclusionary restrictions that prevent small business owners from obtaining PPP relief
- If they have prior, non-fraud felony convictions OR
- If they are delinquent on their federal loans
- Clarification that non-citizen small business owners who are lawful U.S. residents may use their Individual Taxpayer Identification Numbers (ITINs) to apply for relief, ensuring access
While attempts are being made to streamline processes and clarify guidance, we encourage our clients to be patient and follow the latest updates on our COVID-19 resource page.
Special thanks to SST Partner Emily Cook for providing the content for this post.