Biden’s Temporary PPP Restrictions | What to Know

Many people have been struggling financially due to COVID-19. This includes small businesses. Because businesses have been shut down, or are operating at limited capacity, many small businesses are facing financial difficulties. If you are a small business owner, you may be wondering what your options are. Luckily, you may be able to apply for the Paycheck Protection Program (PPP). Recently, President Joseph Biden has made some temporary changes to PPP. Read on to learn more about PPP, what it is, how it can help you, and what restrictions have been placed.

What is the Function of PPP?

PPP stands for Paycheck Protection Program. As of April 3, 2020, small businesses can now apply for these loans, while independent contractors and self-employed individuals were able to apply beginning on April 10, 2020. These loans are meant to cover small businesses’ payroll and other designated expenses. It is important to note that not all small businesses can apply for PPP. According to Business Insider, “business owners with non-fraud felony arrests or convictions in the previous year are excluded from the program.” Currently, Biden administration officials are working to remove this restriction, unless the applicant is currently incarcerated.

How Much Money in Loans Can I Borrow?

Under PPP, if you are a small business owner, you may borrow up to 250 percent of your average monthly payroll expenses, not exceeding $10 million. This should cover up to eight weeks of payroll expenses, as well as payments for certain debt obligations your business may have incurred. 

Are PPP Loans Forgivable? 

The amount of the forgivable loan’s principal after 8 weeks is equal to the sum of the following expenses:

  • Payroll, including your employee’s salaries up to an annual rate of pay of $100,000, hourly wages and cash tips, group health insurance premiums, and paid sick or medical leave.
  • Existing interest payments on mortgages
  • Utility service agreements
  • Rent payments
  • Leases

What Are the New PPP Restrictions?

For a brief period, only businesses with fewer than 20 employees can claim pandemic relief loans. According to Business Insider, “The changes are designed to make it easier for businesses with no employees — sole proprietors, independent contractors, and self-employed people such as house cleaners and personal care providers — that previously could not qualify because of business cost deductions.”

If you are struggling financially, speaking with a bankruptcy attorney may be the best option for you. Contact our firm to speak with a knowledgeable and experienced bankruptcy attorney. We are here to advocate for you and help you get on the right track.


Michael D. Pinsky, P.C. represents clients in bankruptcy actions and related matters. Please call 845-394-2616 or contact the firm online to schedule a consultation.

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