PPP Loans 2.0 – > New loan application information

graphic image PPP 2.0




In December 2020, legislation was passed authorizing the Paycheck Protection Program (PPP) version 2.0.  PPP 1.0 passed in March 2020 in response to the pandemic.


Prior PPP borrowers must meet all of the following conditions to be eligible for PPP 2.0:

  • Eligible businesses who employ no more than 300 employees per physical location;
  • Have used or will use the full amount of their first PPP loan; and
  • Demonstrate at least a 25% or greater sales decline in any quarter of 2020 compared to the same quarter in 2019


Borrowers of PPP 2.0 may receive a loan up to 2.5 times the average monthly payroll costs in one year. Borrowers can use their 2019 or 2020 payroll data to calculate average monthly payroll costs. Borrowers in the hospitality or food service industries may receive PPP 2.0 loans of up to 3.5 times the average monthly payroll costs.  The maximum loan size for this round is $2 million per business.


Smaller PPP 2.0 loans have a simplified certification and revenue test. PPP 2.0 loans of no more than $150,000 may submit a certification before the loan forgiveness application is submitted, attesting that the entity meets the applicable revenue loss requirement.


PPP 2.0, like PPP may be forgiven for payroll costs up to 60% and non-payroll costs like rent, mortgage interest and utilizes up to 40%. Eligible non-payroll costs have been expanded from the original PPP.


This legislation clarifies that expenses paid from the loans under PPP and PPP 2.0 are deductible.

Tom Scanlon, CPA, CFP® has over thirty-five years experience in public accounting with an extensive background in the areas of financial, tax and estate planning.

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