On Monday December 21, 2020, Congress passed a new $900 billion fiscal stimulus package aimed at boosting an economy still struggling with the effects of COVID-19.
The new legislation provides $284 billion of new funding for the Paycheck Protection Program (“PPP”) and allows for some businesses to apply for a second round of funding. The bill also modifies or clarifies several PPP-related rules and procedures.
In addition, Congress approved direct cash payments to many taxpayers and further aid to certain industries.
Congress Passes New $900 Billion Stimulus Package
On Monday, December 21, 2020, Congress passed a significant $900 billion fiscal stimulus package aimed at bolstering an economy that continues to grapple with the effects of the COVID-19 pandemic. This new legislation provides critical support to businesses and individuals, ensuring continued economic recovery and stability during these challenging times.
One of the key components of this stimulus package is the allocation of $284 billion in new funding for the Paycheck Protection Program (PPP). This funding will enable many businesses to apply for a second round of PPP loans, providing essential financial relief to those still struggling to maintain operations and retain employees. The bill also introduces several modifications and clarifications to existing PPP-related rules and procedures, ensuring greater accessibility and flexibility for businesses seeking support.
Highlights of the new PPP provisions include:
- Second Round of PPP Loans: Eligible businesses that have already received and utilized a PPP loan can now apply for a second round of funding. This additional support is aimed at businesses that continue to face significant revenue losses due to the pandemic.
- Clarified Eligibility and Usage Rules: The new legislation refines the eligibility criteria for PPP loans, making it clearer which businesses qualify for support. It also provides detailed guidance on allowable uses of the funds, helping businesses maximize their financial relief.
- Simplified Forgiveness Process: The bill introduces a simplified loan forgiveness process for smaller loans, reducing the administrative burden on businesses and streamlining the path to loan forgiveness.
In addition to the PPP enhancements, the stimulus package includes direct cash payments to many taxpayers, providing immediate financial relief to individuals and families. Congress has also approved targeted aid for specific industries that have been disproportionately affected by the pandemic, such as the transportation and hospitality sectors.
This comprehensive stimulus package represents a critical step in supporting the nation’s economic recovery and providing much-needed relief to businesses and individuals alike. Please refer to our latest alert for more detailed information on how this new legislation may impact your business or personal finances.
At Gesmer Updegrove LLP, we are dedicated to keeping our clients informed about important legislative developments and providing expert guidance to navigate these unprecedented times. Please do not hesitate to reach out to our team for personalized advice and support.