The Small Business Administration (SBA) and the Treasury Department issued a revised borrower application form and new guidance for the Paycheck Protection Program (PPP). Among other revisions, the new guidance expands PPP eligibility for businesses with owners who have past felony convictions.
Under the new guidance, the eligibility threshold for those with felony histories has been changed. The look-back period under the revised PPP has been reduced from five years to one year to determine eligibility for applicants, or owners of applicants, who, for non-financial felonies have been convicted, pleaded guilty, pleaded no contest, or been placed on any form of parole or probation.
The look-back period remains five years for felonies involving fraud, bribery, embezzlement, or a false statement in a loan application or an application with federal finance assistance. The revised application also removes pretrial diversion status as a criterion affecting eligibility.
The SBA says it will issue additional guidance regarding loan forgiveness and a revised forgiveness application to implement the Paycheck Protection Program Flexibility Act in the near future.
