Legal Blog

Bill Passed by Senate Provides Further Allocations for PPP Loans

Today, the Senate passed the bill, Paycheck Protection Program and Health Care Enhancement Act (“PPP and HCE Act”), which provides generally $484 billion in new coronavirus aid to small businesses and hospitals. The PPP and HCE Act includes a further allocation for the PPP administered by the Small Business Association (“SBA”), following initial $349 billion funding under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The PPP funds, earmarked generally to provide covered business loans up to $10,000,000 to eligible recipients adversely impacted by COVID-19 were depleted last week. Senate acted to replenish the PPP. The bill is expected to pass the House of Representatives on April 23, 2020.

Section 1102(a) of the CARES Act initially authorized the SBA to administer the PPP by amending section 7(a) of the Small Business Act, 15 U.S.C. 636(a). Section 101(a)(1) of the PPP and HCE Act raises the appropriations limit for the PPP from $349 billion to $659 billion by amending CARES Act section 1102(b)(1). Payroll costs taken into account for determining the maximum loan amount exclude qualified sick leave or qualified family leave paid by an employer with fewer than 500 employees, for which a credit is allowed under the Families First Coronavirus Response Act. Thus, among other considerations, employers affected by COVID-19 restrictions should consult with a tax advisor on the distinct benefits of applying for a PPP loan and claiming a payroll credit for qualified sick or family leave provided by the employer.

ABOUT MARINA VISHNEPOLSKAYA

Marina Vishnepolskaya’s practice focuses on domestic and cross-border tax and employee benefits matters. She counsels employers and executives on a wide range of employee benefits and executive compensation matters, including drafting and amending salary, bonus, cash and equity-based deferred compensation plans, fringe benefit plans and other compensation arrangements, employee policies and handbooks, employment and separation agreements, compliance with IRS voluntary plan correction requirements for nonqualified plans and related employment and tax laws.

 

 

 

 

 

 

 

ABOUT OFFIT KURMAN

Offit Kurman, one of the fastest-growing, full-service law firms in the United States, serves dynamic businesses, individuals and families. With 15 offices and nearly 250 lawyers who counsel clients across more than 30 areas of practice, Offit Kurman helps maximize and protect business value and personal wealth by providing innovative and entrepreneurial counsel that focuses on clients’ business objectives, interests and goals. The firm is distinguished by the quality, breadth and global reach of its legal services and a unique operational structure that encourages a culture of collaboration. For more information, visit www.offitkurman.com.

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