The Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (part of the recently enacted Consolidated Appropriations Act, 2021) includes several important provisions affecting small business owners, especially Paycheck Protection Program loan recipients. For short, I’ll call it EAHSBNVA. It is just part of Division M of the Consolidated Appropriations Act, 2021.
There is a lot to unwrap here. The Consolidated Appropriations Act, 2021 is a massive act consisting of 5,593 pages. The table of contents is 5 pages long. It funds the federal government for 2021 and authorizes over $2 trillion in expenditures. This is what is known as a “garbage bill” in the lawmaking business. Rather than having a single topic, it is a mishmash of dozens of separate bills that are all combined into one giant package. You won’t see many other commentators use the term garbage when referring to this bill. Like Santa’s sleigh, it is loaded with gifts and treats for almost every American.
Division N of this huge bill includes both the COVID-related Tax Relief Act of 2020 and the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act as well as various other provisions.
Highlights of the COVID-related Tax Relief Act of 2020 include:
- Additional rebates for individuals,
- Amendments to the CARES Act,
- Extension of deferred payroll taxes,
- Clarification of tax treatment of forgiveness of PPP loans,
- Extension of credits for paid sick and family leave, and
- Other technical tax law changes.
Highlights of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act include:
- Additional eligible expenses (retroactively expanding the PPP expenses eligible for forgiveness),
- Simplified forgiveness application (one-page forgiveness application for loans under $150,000),
- Clarification of and additional limitations on eligibility,
- Paycheck protection program second draw Loans, providing another round of PPP funding,
- Increased ability for PPP borrowers to request an increase in loan amount due to updated regulations,
- Farmers and ranchers,
- Definition of seasonal employer,
- Housing cooperatives,
- Eligibility of news organizations for PPP loans,
- Eligibility of non-profits and destination marketing organizations for PPP loans,
- Prohibition on use of loan proceeds for lobbying activities,
- Grants for shuttered venue operators,
- Extension of the debt relief program,
- Modifications to 7(a) loan programs, and
- Assorted other less interesting provisions.
I’ll be diving deeper into the areas of greatest interest to small business owners in future postings soon.
- Mark S Gleason CPA