Are You Eligible for a Second PPP Loan?

January 26, 2021

The Small Business Administration and U.S. Treasury Department announced the Paycheck Protection Program (PPP) re-opened the week of Jan. 11. Congress recently added $284 billion in new loan forgiveness authority for new borrowers and certain existing PPP borrowers. 

The new funding is available to both first-time applicants and returning borrowers. Most of the original rules apply for first-time applicants. The rules are more strict for those seeking a second loan. 

A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
  • Has no more than 300 employees
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020

This round of the PPP continues to allow small business borrowers to have their loans forgiven if they spend the funds on job retention and certain other expenses through March 31. 

Key PPP updates include:

  • PPP borrowers can set their PPP loan's covered period at any length between eight and 24 weeks to best meet their business needs
  • PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs and worker protection expenditures
  • The program's eligibility is expanded to include 501(c)(6)s, housing cooperatives and direct marketing organizations among other types of organizations
  • The PPP provides greater flexibility for seasonal employees
  • Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount
  • Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan


Contact ALTA at 202-296-3671 or [email protected].