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House OKs PPP Loan Application Deadline Extension

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What You Need to Know

  • Sponsoring lawmakers call the legislation a bipartisan, common-sense way to help small businesses.
  • The short-term extension will help address the lingering economic impacts of the pandemic, Rep. Velázquez says.
  • The American Institute of CPAs says the bill is needed given tax and compliance challenges for the second round of PPP loans.

The full House passed Wednesday the Paycheck Protection Program (PPP) Extension Act of 2021, bipartisan legislation that would extend the PPP loan application deadline from March 31 to May 31.

The bill, H.R. 1799, was introduced Thursday and sponsored by House Small Business Committee Chairwoman Nydia M. Velázquez, D-N.Y.; ranking member Blaine Luetkemeyer, R-Mo.; Rep. Young Kim, R-Calif.; and Rep. Carolyn Bourdeaux, D-Ga.

The bill would also provide an additional 30 days for the Small Business Administration to process loan applications submitted prior to the new May 31 deadline.

“As America begins to open up for business and vaccines become more widely distributed across the country, we must provide targeted relief for small businesses that need it most,” Luetkemeyer said Thursday in a statement. “This bipartisan legislation will provide a commonsense extension to the Paycheck Protection Program and the tools for Main Street USA to contribute to their local economies once again.”

“The demand for PPP loans right now is a testament to the program’s effectiveness and the lingering impacts of this pandemic,” Velázquez added. “That’s why we cannot cut off aid now and this short-term extension is so important. Under this bill, small businesses will have two additional months to submit an application for a PPP loan, and SBA will have until June 30, 2021 to close any pending applications.”

The American Institute of CPAs urged Velázquez and other members of the committee to extend the March 31 application deadline for the PPP by at least 60 days, citing “urgent” tax and compliance challenges facing small businesses and CPAs.

“Significant operational problems [exist] within the PPP process that are resulting in urgent challenges and significant complexity for many small-business borrowers who are trying to enter into the SBA system, and delays in processing once in the system,” said Lisa Simpson, vice president of firm services at the AICPA.

An extension would allow the SBA “to address its technical issues, provide critical guidance, and work with lenders and borrowers so that small businesses can navigate the application process and receive a loan,” Simpson told the lawmakers.

(Photo: Shutterstock)

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