SBA to Publish IFR Making 501(c)(6) Organizations Eligible for PPP Loans, Expand Loan Forgiveness to Include COBRA Premiums
On Monday, the Small Business Administration (SBA) will publish an interim final rule (IFR) to update the Paycheck Protection Program (PPP) pursuant to the American Rescue Plan Act, which was enacted on March 11, 2021.
Of particular interest for SWACCA affiliates, this IFR expands eligibility for “first-draw” and “second-draw” PPP loans to additional tax-exempt organizations, including 501 (c)(6) organizations. This was a critical provision that SWACCA successfully fought to include in the American Rescue Plan Act. Specifically, the legislation provided that 501(c)(6) organizations that are exempt from taxation under 501(a) are eligible to receive first-draw PPP loans if: (1) they employ no more than 300 employees per physical location; (2) they do not receive more than 15% of their receipts from lobbying activities; (3) lobbying activities do not comprise more than 15% of total activities; and (4) the cost of lobbying activities for the most recent tax year ending prior to February 15, 2020 do not exceed $1 million.
In addition, this IFR implements provisions of the American Rescue Plan Act that expanded PPP loan forgiveness to include payments made for premiums on behalf of individuals who qualify for COBRA health insurance continuation coverage.
The IFR will take effect on March 22, 2021. Comments on the IFR are due by April 21, 2021 and can be submitted here using Docket ID SBA-2021-0013.
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