Following considerable negotiation, Congress voted December 21, 2020, to authorize additional funding for new COVID-19 assistance for businesses and individuals. President Trump put his signature on the bill on December 27, 2020, and applications for assistance resumed on January 11, 2021.

Part of the sweeping bill that includes emergency economic relief, government funding, and tax cuts, the legislation is one of the largest measures enacted by the U.S. House of Representatives and U.S. Senate.

The legislation includes an extension of federal unemployment benefits – providing $300 per week through mid-March to those laid off because of the coronavirus – as well as direct payments of up to $600 for individuals making up to $75,000 annually (or couples making up to $150,000) and an added $600 for each dependent child.

Other financial aid offered by the COVID-19 relief legislation includes:

• $54 billion for public K-12 schools impacted by the pandemic and nearly $23 billion for colleges and universities
• $20 billion for vaccines, $20 billion to assist states with testing, and $8 billion for vaccine distribution
• $15 billion for the entertainment industry, including independent movie theaters, entertainment venues, music clubs, and cultural institutions

The most significant aspect of the legislation for small businesses is
a revival of the Paycheck Protection Program (PPP), providing more than $275 billion to fund forgivable loans to qualified businesses hard hit by the coronavirus. The loan limit is $2 million, and businesses qualify based on their average monthly payroll in 2019, multiplied by 2.5 (or 3.5 if a qualifying restaurant or food-related business). This permits a business to secure a loan of up to 2.5 times its monthly payroll expenses. For example, if an employer had a monthly payroll of $100,000 in 2019, the business would qualify for a $250,000 loan. A qualifying restaurant or food business with a monthly payroll of $100,000 could qualify for a $350,000 loan.

Applications for first-time PPP applicants began January 11, 2021, through community financial institutions. Other financial institutions will begin taking applications later. Second Draw PPP loan applications began Wednesday, January 13, 2021, through community financial institutions only. 

To be eligible for a Second Draw PPP loan, a small business must have 300 or fewer employees – down from a 500-employee maximum in the prior program. Businesses have 24 weeks to use the funds, which can go toward payroll as well as rent or mortgage expenses.

Additional program details are available through a U.S. Small Business Administration office or participating institutions.