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Paycheck Protection Program

 

PLEASE NOTE:  As previously communicated, VEDA stopped accepting PPP applications on Wednesday, 5/26, @ 5pm to allow time to process ahead of the SBA submission deadline.


Click here for information about PPP loan forgiveness. 

2021 PPP Updates

More than $284 billion has been allocated to the SBA for first-time and second-time recipients of PPP forgivable loans. The new legislation also allows businesses to apply for both the PPP loan for payroll expenses and to take the Employer Retention Tax Credit (ERTC) on their IRS 941 for both 2020 and 2021. To learn more about this, reach out to your CPA or the IRS.

The updated PPP program follows previous Cares Act loan size, loan rules and guidance with some nuances. The application period was also recently extended to May 31, 2021.

First draw PPP Loan applicants: PPP borrowers may receive a loan amount of up to 2.5 times their average monthly payroll costs in the year prior to the loan or the calendar year, with a maximum loan amount of $10 million. 

Second draw PPP Loan applicants: New in this legislation is the ability to apply for a second PPP loan in an amount up to 2.5 times the average monthly payroll, up to $2MM. PPP borrowers with NAICS codes starting with 72 (Accommodation & Food Services) can get up to 3.5 times their average monthly payroll costs. Eligibility for a second draw PPP loan includes businesses:

  • that have 300 or fewer employees;
  • that have used the full amount of their first PPP loan;
  • that can demonstrate a 25% gross revenue decline in any 2020 quarter compared to the same quarter in 2019, or for the year as a whole.

First draw PPP Loan modification (increase) applicants: New as of December 2020 is the ability to apply for an increase to your first draw PPP Loan in certain circumstances. Applicants must apply through the same lender of their first PPP loan and are not eligible if they have already been granted loan forgiveness or have been approved for a second draw PPP loan. See below for more eligibility requirements.

Schedule C borrowers: As of March 3, 2021 the SBA has approved two formulas to calculate the self-employment income for the owners of companies which file a Schedule C; one based on net income (line 31 of the Schedule C) and one based on gross income (line 7 of the Schedule C). There was no change to the formula for any non-owner employees that the company may have. The changes are approved only for loans submitted from March 3, 2021 and forward. The SBA specifically stated that increases (due to this change) to loans approved prior to March 3, 2021 would not be allowed. The Schedule C business owner may choose either option to calculate their self-employment income:

  • Schedule C line 31 (net income); capped at $100,000
  • Schedule C line 7 (gross income) – line 14 – line 19 – line 26; capped at $100,000
    • The SBA has indicated that it will review borrowers’ certifications concerning the necessity of their loan and whether they complied with PPP eligibility criteria on a sample of the applications in which the self-employment income is based on the gross income formula above and where the company has gross income in excess of $150,000 in order to reduce fraud or abuse.
    • If your net income is $100,000 or larger, use the net income based formula to avoid the additional SBA review as you’ll be getting the maximum self-employment based loan.
    • If your net income is below $100,000 you will likely benefit from using the gross income formula.

Application Process

We are accepting applications. Please download the appropriate application package below and email the completed contents to your VEDA loan officer. To find your loan officer's contact information, visit our staff directory page. 

If you don't have a VEDA loan officer, please email ppp@veda.org or call (802) 828-5627 to begin the application process. Both the SBA and VEDA are committed to helping minority, underserved, veteran and women-owned businesses access PPP forgivable loans. 

Each PPP application package below is a .zip file with an SBA application form, a checklist to help ensure you submit all required documentation and a Microsoft Excel calculator to help estimate your maximum loan size.

Choose the correct application below, make sure to note if you are a Schedule C business:
  • First time PPP borrowers:
  • Second time PPP borrowers who are currently VEDA PPP borrowers:
  • Second time PPP Borrowers who have not previously worked with VEDA:
  • If you are an existing VEDA borrower looking to increase your first draw PPP loan, and meet the below eligibility requirements, download the following application package:
  • Eligibility Requirements to increase your first draw PPP Loan:
    • Partnerships: Initial PPP loan guidance took into account payroll costs for employees only and specifically excluded partner compensation, which is capped at $100,000. As a result, you may qualify for an increase.
    • Seasonal companies: A change in the definition of a seasonal company and a change in the calculation of average monthly payroll costs may result in an increased loan size for the applicant. Specifically:
      • A company is now considered seasonal if gross receipts for any 6 month period of the year are not more than 33.33% of its gross revenues for the other 6-month period of the same calendar year. Previous definition included only that the company could not operate more than 7 months in a calendar year or the preceding calendar year. Now either of these definitions apply.
      • A seasonal company can now calculate its average monthly payroll costs by choosing any 12-week period payroll costs during the time period of 2/15/2019 – 2/15/2020. Refer to sec. 336 of Economic Aid Act for details.
    • Farmers & Ranchers: A change in the calculation of maximum loan amount for certain Farmers and Ranchers may result in an increased loan size for the applicant. Farmers and Ranchers that are sole proprietors, independent contractors, or self-employed individuals who report their income on a schedule F.  Specifically:
      • Without employees:  The gross income of applicant in 2019 or 2020 (as reported on schedule F line 9) and capped at $100,000. This number will be divided by 12 months and multiplied by 2.5 months for a resulting loan size up to $20,833.
      • With employees: Your self-employed income is calculated as Schedule F line 9 minus lines 15, 22, 23 and 37, then capped at $100,000 plus the payroll costs paid to your employees. The sum is then divided by 12 to determine your monthly average payroll and then multiplied by 2.5 to determine your loan amount.

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