Getting the most out of the stimulus package for your small business

Another round of PPP funding is on the way for small businesses as they fight to get through a bitter winter.

by Chris Casacchia
updated May 11, 2023 ·  3min read

The Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act was passed in December 2020, providing a lifeline to struggling small business owners to the tune of $325 billion.

Here is an overview of the legislation and how small businesses can access this second round of government support.

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More PPP help on the way

A key piece of the new stimulus program is the $284 billion earmarked for the second round of Paycheck Protection Program (PPP) loans. The legislation specifies that businesses can use loans to cover a wide range of expenses, including utilities, rent or mortgage payments, and debt interest.

PPP loans can also be used for:

  • Payments for software, cloud computing, accounting, human resources
  • Supplier costs
  • Group health benefits
  • Uninsured property damage due to civil unrest
  • Personal protective equipment and related investments to meet health and safety guidelines.

Tax concerns addressed

The assistance package also clears up some major tax concerns for proprietors, according to Alexa Heter, owner of Heter Accountancy in San Luis Obispo, Calif.

"The 2021 Consolidated Appropriations act overruled the IRS and determined that PPP loans are not taxable and that the forgiven expenses are tax-deductible," says Heter. "This is going to be extremely helpful to business owners."

She adds that unused payroll costs for loan forgiveness can now be applied towards an employee retention credit for 2020 or this year.

Most loans are expected to be forgiven through a simplified application, another new addition.

What else is in the bill?

The voluminous legislation features several new requirements and guidelines related to:

  • Eligibility. Recipients are capped at 300 employees and must show at least a 25% year-over-year decline in second, third or fourth quarter gross receipts from 2020. Businesses established after Feb. 14, 2020, are prohibited from applying.
  • Financing. Second round loans are maxed out at $2 million. First-round PPP recipients must utilize prior funding before accessing a second loan.
  • Expansion: A few sectors have been added to the list of potential recipients, including live venue operators and promoters, theatrical producers, live performing arts operators, museum operators, motion picture theatre operators, talent representatives, newspapers, TV stations, and radio broadcasters.

Persistence will be key

Though necessary for survival, getting a piece of the $325 billion package may be a tricky business.

As banks and other lenders brace for an onslaught of application requests, Cody Warren, a digital marketing specialist at Minneapolis-based Hook Agency, asserts persistence pays off.

"My biggest suggestion is to talk to multiple banks, and be creative about getting through to them," says Warren, whose firm applied early and worked with several banks to secure loans in the first round of the Paycheck Protection Program. "Call, e-mail, walk up to the window. Try all three and do it day after day."

Reliable resources

Amanda Ma, owner of Pasadena, Calif.-based Innovate Marketing Group, credits solid relationships with bankers and accountants for helping her Southern California firm secure a first-round PPP loan under $80,000. The loan helped her retain her entire staff during the early months of the pandemic.

She recommends contacting local chambers of commerce, the Small Business Administration, and other business groups to learn more about the program extension.

"We even invited someone from the SBA to speak to a business webinar our agency put together," said Ma.

Her business pivoted to offering virtual events and Events-To-Go Kits as social distancing requirements, venue closures, and mass gathering prohibitions crushed the hospitality industry.

"Business is not back to usual, so the second round of PPP loans would be helpful to continue to retain the talent that we have developed and operating expenses such as rent," Ma says.

'Desperate situation'

Sales at Yungi Chu's professional headset business slowed in March, then came to a screeching halt as he struggled to keep it afloat for most of the year.

He's applying for another PPP loan. The first helped fund payroll for 15 of his employees from June to October, just before California became a global epicenter for coronavirus outbreaks.

"We're in a desperate situation trying not to lay off any existing employees," says Chu, owner of "That's the whole purpose of the federal PPP loan program."

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Chris Casacchia

About the Author

Chris Casacchia

Chris Casacchia is an award-winning journalist, editor, and media consultant based in Los Angeles specializing in busine… Read more

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