President Donald Trump signed Congress’s extension of the Paycheck Protection Program application deadline until August 8.
On June 25th, the Small Business Administration and Treasury Department released new guidance for the Paycheck Protection Program specific to the commercial fishing industry:
- The interim rule, effective immediately, allows boat owners and fishing businesses to include payments to fishing vessel crew members reported as fishing boat proceeds on Form 1099-MISC to be eligible payroll costs under the Paycheck Protection Program.
- If a crew member has already received their own PPP loan as a 1099 contractor, they are not eligible to be included in a new PPP loan application. Essentially, they cannot double dip. The SBA noted the possibility of double dipping in their interim rule: “Due to the increased risk of duplicate payroll costs, PPP loans to fishing boat owners are more likely to be subject to an SBA loan review.” The SBA advises applicants to be diligent in applications and record-keeping.
- If you are a vessel or business owner who has already submitted and received a loan application, you may be able to amend your loan amount if your lender has not submitted SBA Form 1502, but you will need to contact your lender institution as soon as possible.
The Paycheck Protection Program Flexibility Act enacted on June 5th provide additional flexibility for PPP loans, including:
- Extending the “covered period” (the period during which funds must be spent in order for the loan to be forgiven) from 8 weeks to 24 weeks;
- Reducing the percentage of the loan amount required to be spent on payroll costs from 75% to 60% in order for the loan to be forgiven;
- Extending loan maturity from 2 years to 5 years (you have 5 years to pay back the loan).
