Paycheck Protection Program January 2021 SBAs REOPENED the

Paycheck Protection Program January 2021

SBA’s RE-OPENED the PPP as of January 11, 2021 If you did not receive a PPP loan in 2020, you are eligible to apply for your first PPP loan in 2021. If you received a PPP loan in 2020, you may be eligible to apply for a second PPP loan if your business suffered a loss in revenue in 2020. (of at Least 25% for any quarter of 2020)

Who is eligible for a PPP loan in 2021? First draw PPP loans If the following statements apply to your church, you are eligible to apply for your first PPP loan in 2021. Your church was operational before February 15, 2020 Your church is still open and operational You have no more than 500 employees If your business has multiple locations, you have no more than 500 employees per location They will have priority this go around

Who is eligible for a PPP loan in 2021? Second draw PPP loans If the following statements apply to your business, you are eligible to apply for your second PPP loan in 2021. You have used up your first PPP loan Your business was operational before February 15, 2020 Your business is still open and operational You have no more than 300 employees If your business has multiple locations, you have no more than 300 employees per location You can show a 25% or greater reduction in gross revenue (of at Least 25% for any quarter of 2020)

The difference between the first PPP loan and the Second PPP loan Showing a 25% or greater reduction in revenue A 25% or greater reduction can be shown in one of two ways: Comparing your annual gross revenue as reported on your tax return between 2020 and 2019 Comparing your gross revenue in any quarter in 2020 with your gross revenue in the same quarter of 2019

How Much Can You Get? Most eligible businesses may get a loan equal to 2. 5 times their average monthly payroll expenses, just as before Restaurants and lodging businesses may now apply for loans equal to 3. 5 times monthly payrolls No loan, however, may exceed $2 million, down from the previous cap of $10 million

Forgivness At least 60% of the money must be used for payroll expenses The remaining 40% of the loan In the first round of loans the 40% included: Mortgage interest, rent and utility payments The 40% NOW may be used to cover the costs of personal protective equipment and other expenses incurred to meet Covid restrictions, as well as certain operations, property damage and supplier costs.

The forgiveness process is simpler. In order to have a PPP loan forgiven, businesses that borrowed $150, 000 or less Simply submit a one-page certification that the church complied with loan requirements. A full 87% of the loans were below $150, 000, according to the Small Business Administration.

Is the PPP loan when Forgiven Tax Free The tax break for PPP loan recipients just got bigger. While the loans will be tax-free for recipients if they're used for authorized purposes, the latest Covid relief package sweetened the pot further Expenses that were largely paid for by the tax-free loan, will also still be deductible See this as an opportunity for Ministry to your congregation members get the word out to them ask them if they need support Create a team of responders at your church

What if the Loan is not Forgiven? These loans would have an interest rate of 1% and a term of five years Loan payments are deferred for 10 months after the covered period ends or when you receive a forgiveness verdict, whichever comes first Diocese giving you a one time exemption you do not need to file with the Standing Committee Deadline to file for Forgiveness is different for each of you.

What INFO do you Need? When applying please make sure you use your EIN number your parish is part of our group number 2195 registered with the IRS Do NOT use the diocese EIN ending in 469 If the bank asks you for a state registration your response is this: The diocese and all of our congregations are Religious Societies existing pursuant to Chapter 61 of the NC General Statutes. There is no provision for Religious Societies to register with anyone or get certificates from anyone. What you can give the bank is a good standing letter with the diocese and a copy of the canons(found on our website)

When do you apply and how? Starting NOW Lenders are expected to be ready to take applications starting as early as this week. Get in contact with a Banker- Larger banks may take longer It is on a first-come, first-served basis so it is imperative to act as soon as possible. The deadline remains open until March 31, 2021

Make this a Priority Do not wait this pandemic is going to take a long time to work its self out It is the most responsible thing you can do for your congregation, your employees and the diocese as a whole Calling you to think as a whole be a partner (41 churches with no clergy or very little payroll)

Next Steps Call or email your lender Get your 2020 financial completed Compare ADP Email all Four Quarters 2019 vs 2020 offers payroll reports your regional Canon or Maria Gillespie if you have questions or to get your letter in good standing from the diocese for your application process

Questions and or Discussion