Second Draw PPP Loans
The Paycheck Protection Program (PPP) now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP Loan with the same general loan terms as their First Draw PPP Loan.
Second Draw PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.
Maximum loan amount and increased assistance for accommodation and food services businesses
For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. For borrowers in the Accommodation and Food Services sector (use NAICS 72 to confirm), the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.
Who may qualify
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
- Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
- Has no more than 300 employees; and
- Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020
For loans of $150,000 and below
The Gross Receipt fields are not required and the Applicant only must certify that the Applicant has met the 25% gross receipts reduction at the time of application; however, upon or before seeking loan forgiveness (or upon SBA request) the Applicant must provide documentation that identifies the 2020 quarter meeting this requirement, identifies the reference quarter, states the gross receipts amounts for both quarters, and supports the amounts provided. For all loans, the appropriate reference quarter depends on how long the Applicant has been in operation:
For Loans Above $150,000
In determining whether the Applicant experienced at least a 25% reduction in gross receipts, the Applicant must identify the 2020 quarter meeting this requirement, identify the reference quarter, and state the gross receipts amounts for both quarters, as well as provide supporting documentation.
PLEASE REFERENCE THE 2483-SD FORM FOR FURTHER INSTRUCTIONS
How and when to apply
If you wish to begin preparing your application, you will need the following:
2. If you intend to use your 2019 payroll information for qualification, you do not need to resubmit your information. Please include your application Form 2483-SD and if your amount requested is over $150,000, you must provide your supporting financial information to show a 25% decline in gross revenue.
OR If you wish to use 2020 payroll data you must include:
If your business is any of the following: Corporation, Professional Corporation, General Partnership, LLC, Nonprofit, please provide the following documentation:
- 2020 IRS Form W-3
- 2020 Form 940
- 2020 Forms 941 (for all quarters)
- If you file a 1065 Tax return K-1 Statement for all partners or members for 2020
- If you have employees making over $100,000:
- W-2 forms for employees making over $100K for 2020
- If you have employees outside the US:
- W-2 forms for employees living abroad for 2020
If your business is any of the following: Sole Proprietorship, Independent Contractor, Self-Employed, Single Member LLC, please provide the following documentation:
If you have employees:
- 2020 1040 Schedule C or F**
- 2020 IRS Form W-3
- 2020 IRS Form 940
- W-2 forms for any employees earning more than $100,000 in 2020
- Payroll statement covering 2/15/2020
If you do not have employees:
- 2020 1040 Schedule C**
**If you have not completed 1040 Schedule C or F for 2020, fill it out and compute the value for line 31. We cannot accept this form for previous years (prior to 2019).
IMPORTANT: If you did not do your First Draw PPP Loan through WoodTrust Bank, you must provide the following information:
- Color copy of government issued ID (front and back) for all owners of the business listed on the application.
- Corporation, Professional Corporation, General Partnership, LLC, Nonprofit – Organizational Documents*
*Examples of Organizational Documents include: Articles of Incorporation, By-Laws, Certificate of Organization, LLC Operating Agreement, Certificate of Formation or Articles of Information.
Additional information is available at www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program