Although we have already addressed some of these program changes in a previous blog post , for clarity some points are repeated below.
Recalculation of 1st draw PPP loans
A new provision (Division N, Title III, Section 313) in the CAA allows Schedule F filing sole proprietors, independent contractors, or self-employed individuals to retroactively recalculate their PPP 1st draw loans based on their 2019 gross income, instead of their 2019 net income. Schedule F filers are farmers and ranchers. In other words, farmers may not recalculate PPP 1st draw loans that are already forgiven. Farmers and ranchers meeting the new qualifications will also be allowed to use the gross income calculations for PPP 2nd draw loans issued in the future. Annualized maximums remain at $100,000 per employee (Division N, Title II, Section 344). The annualized maximum applies to the new gross income based farm and ranch owner’s compensation calculations as well, with few exceptions. While non-farmers and non-ranchers may also be able to qualify for possible recalculations or first-time loans under specific circumstances, the recalculation based on gross versus net income is specific to Schedule F filers (i.e. only farmers and ranchers). The flow-chart below shows producers how to determine if they qualify for new 1st draw PPP funds, either via a first-time application or via a reapplication.Read More »However, if the PPP loan has already been forgiven in 2020, there is an exception to recalculating