The deadline to apply for a Paycheck Protection Program (PPP) loan was formally extended Tuesday when President Biden signed the PPP Extension Act of 2021, H.R. 1799 into law.
The popular program established by the CARES Act, which was created to help small businesses weather the fallout from the coronavirus pandemic, provides a 60-day extension and will now accept applications until May 31st. The bill will assist small businesses and not-for-profits by providing additional time to complete PPP applications and file new ones.
The extension act also provides the SBA a new deadline of June 30th to authorize loan applications and address many of the processing challenges and changes to the loan calculation for self-employed borrowers. The PPP Extension Act does not provide additional funding for the current round of PPP which Congress has set at $290 billion in forgivable loans.
The calls to extend the PPP deadline have grown since February when changes to the program were made by the Biden administration just weeks before it was set to end. The updates were intended to provide additional funding to the smallest businesses but the new eligibility rules and calculation formula for sole proprietors created confusion for many. In a letter to the sponsors of the new legislation, the AICPA said the 60-day extension would give the SBA the time needed to address processing delays and technical challenges with its PPP platform and provide needed guidance for PPP and other COVID-19 business relief programs.