The US Department of Justice announced the first civil settlement involving allegations of fraud against a PPP borrower.
SlideBelts Inc. received a PPP loan under the CARES Act. SlideBelts is an internet retail company and debtor in bankruptcy. SlideBelts and its president/CEO agreed to resolve the allegations in connection with the PPP loan by paying the government damages and penalties of $100,000. SlideBelts had already repaid the $350,000 PPP loan it had received.
The announced civil settlement resolves claims that the conduct of SlideBelts and its president/CEO violated ...
The Economic Aid Act authorizes new PPP loans for first-time borrowers, as well as applications for a Second Draw PPP Loan for those that already received a loan last year. This alert addresses the requirements and issues for the self-employed and sole proprietors with no employees, who wish to apply for a Second Draw PPP Loan under the new law.
Requirements:
If you are self-employed/or a sole proprietor, with no W-2 employees, and you report income from your business on your personal tax return (Form 1040/Schedule C), and if you qualified for a First Draw PPP Loan and would continue to ...
The President signed new stimulus legislation into law on December 27, 2020. The new law, the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, P.L. 116-260 (“Economic Aid Act”), authorizes new and additional PPP loans and modifies the CARES Act for this purpose. The Economic Aid Act authorizes funds of $284.5 billion for PPP loans, and which includes $35 billion for first-time borrowers. The United States Small Business Administration (SBA) and the United States Treasury also issued new guidance interpreting the new law.
The new SBA/Treasury guidance ...
PPP loans under the CARES Act are being audited by the SBA. All PPP loans over $2 million will be audited, and many more under $2 million will be audited as well. Applying for forgiveness of a PPP loan increases the likelihood of an audit.
An audit or “review” by SBA of a borrower and its PPP loan can result in an SBA determination that the borrower (1) was ineligible for a PPP loan; (2) was ineligible for the PPP loan amount received or used the PPP loan proceeds for unauthorized uses; (3) is ineligible for PPP loan forgiveness in the amount determined by the lender in its full or partial ...
The Small Business Administration (“SBA”) recently issued a new interim final rule clarifying whether paycheck protection program (“PPP”) loan proceeds may be used for certain payroll and nonpayroll costs and remain eligible for forgiveness, notwithstanding earlier guidance or uncertainty. Generally, PPP loans may be forgiven so long as used for a borrower’s payroll costs (generally, all compensation, capped at $100,000 on an annual basis, plus benefits) and certain mortgage interest, rent and utility expenses. Various guidance in the wake of the implementation ...
On May 15, 2020 the Small Business Administration (SBA) released a Paycheck Protection Program Loan Forgiveness Application with related instructions. The application and instructions help answer some of the questions surrounding a business’s eligibility for forgiveness (see our prior blog for an overview of forgiveness issues). A detailed overview of the application and instructions is available here. Some of the key issues addressed in the application and instructions include:
- The 8 week covered period during which qualifying expenses are measured begins on the date a ...