While there has been no formal announcement, The New York Times reported that the Small Business Administration (SBA) recently relayed to the National Association of Government Guaranteed Lenders that funding for the Paycheck Protection Program (PPP) was depleted Tuesday, May 4, 2021, and has stopped accepting most new applications1. For loan applications already submitted, the SBA has reserved approximately $6 billion in funding. There is also approximately $8 billion remaining for PPP loans made by financial institutions designated by Congress as Minority Depository Institutions (MDI) and Community Development Financial Institutions (CDFI)2.
With this announcement, loan applications that have not received an SBA loan number have not been approved. The PPP was part of last year’s CARES Act and is designed to help small businesses with forgivable loans. In a December 2020 coronavirus relief bill, Congress allocated an additional $284 billion to the PPP in funding. As of May 2, 2021, the SBA’s PPP Report indicated that the SBA had authorized $258 billion .3 The sudden suspension of the program may lead to a sizable and time-consuming backlog, so businesses awaiting feedback may not have an answer for weeks.
How DHG Can Help
Stay connected to DHG as we will share further PPP announcements from the SBA. DHG helps companies understand how updates like these could impact your business, especially regarding PPP loan reporting and forgiveness. DHG connects you to professionals with in-depth industry insights who focus on a wide range of advisory, assurance and tax services. We are happy to answer your questions and detail how this update affects your specific situation. For more information, reach out to us at firstname.lastname@example.org.