2 0 SBA PPP and EIDL Updates January

2. 0 SBA PPP and EIDL Updates January 12, 2021 1

About the Maryland SBDC 2

Reach Out to Experts The Maryland SBDC is committed to serving our clients during the COVID-19 health emergency while maintaining a safe environment for our clients and staff. Please visit our website to: • Access useful information including our COVID-19 Survival Guide and Small Business Recovery and Sustainability Guide • Learn more about upcoming trainings • Connect with a business consultant in your county www. marylandsbdc. org 3

Presenter Roderick Johnson Lender Relations Specialist, SBA Rod has a strong community service background in sales management, financial analysis, underwriting, business development, portfolio management, pricing, proposal, presentation and negotiation skills for companies doing business domestically and internationally. 4

COVID-19 Recovery The long-awaited second COVID-19 recovery package was signed into law December 27, 2020. The package includes many provisions small business owners have been fighting for, including a second round of funding for both the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) Advance Grant. Eligibility is more targeted for both programs. The new law also makes a number of business-friendly tax changes to both programs, as well as extending some of the tax credits from the first recovery package. 5

Main Takeaways: PPP What small business owners should know Overview Re-opened through March 31, 2021 with an additional $284 billion in funding. Eligibility Businesses are eligible to receive a SECOND, forgivable loan if they: ● Employ 300 employees or less ● Have used or will use the full amount of their first PPP ● Demonstrate at least a 25% reduction in gross receipts in any quarter in 2020 (compared with same quarter in 2019) Small business owners can also apply for an INITIAL PPP loan 6

Main Takeaways: PPP (continued) ● Simplifies the forgiveness application for loans under $150, 000 ● Allows borrowers to specify a covered period between 8 and 24 weeks for PPP 2. 0 loans ● Repeals the requirement of deducting an EIDL Advance Grant from PPP loan forgiveness amount ● Expands eligible expenses to include costs for modified business operations, supplier costs, and costs associated with complying with health and safety guidelines. ● Businesses in the restaurant and hospitality industries are eligible to receive loans of 3. 5 times the average monthly payroll, rather than 2. 5 times. 7

EIDL Advance Grant 2. 0 Overview Adds another $20 billion for EIDL Advance grants Eligibility Eligible small businesses are able to receive additional funding if their first EIDL Advance Grant was under $10, 000. Businesses are eligible to receive an EIDL Advance Grant if they: ● Employ 300 employees or less ● Demonstrate at least a 30% reduction in gross receipts in any 8 -week period between March 2, 2020 and December 31, 2021. ● Are located in a low-income community such as defined for the New Markets Tax Credit (NMTC) 8

Tax Provisions Reverses IRS ruling to allow tax deductions for PPP forgiven expenses and clarifies that PPP loan forgiveness is not taxable income. Clarifies that EIDL Advance Grants are not included in taxable income. Extends FFCRA tax credits through March 31, 2021. Extends the Employee Retention Tax Credit through July 31, 2021 and expands the credit 9

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Contact your local SBA Representative Roderick L. Johnson Montgomery & Prince George's County Lender Relations/Small Business Development Center Officer Michael P. Collins All counties of Maryland Excluding: Montgomery & Prince George’s Lender Relations Specialist & District International Trade Officer U. S. SBA, Washington Metropolitan Area District Office (WMADO) U. S. SBA, Baltimore District Office 409 3 rd St. SW, Floor 2 Washington, DC 20416 100 S. Charles Street, Suite 1201, Baltimore, MD 21201 Main: (202) 205 -8800 Direct: (202) 205 -70075 Mobile: : (202) 617 -4435 roderick. johnson@sba. gov Main: 410 -962 -6195 Office 410 -244 -3341 Mobile 410 -913 -8943 michael. collins@sba. gov www. sba. gov/lenders 11

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