New PPP Loans Focus on Smallest Business Owners

According to the Wall Street Journal, the federal government will offer a revised PPP (Paycheck Protection Program) loan program tailored specifically to small business owners with less than 20 employees.  The goal is to focus on access to PPP loans for small companies, including minority-owned businesses and businesses within underserved communities that may not have had traditional banking relationships.  It is estimated that 98% of small businesses have fewer than 20 employees.


This program has a tight window for making your application beginning Wednesday, February 24, at 9 a.m. ET until 5 p.m. on March 9.  No other applications will be accepted during this period.

What Has Changed

  • Under the prior program, loan amounts were calculated, in part, based on a business’s net income as reported on their tax return.  The new program allows business owners to calculate loan amounts based on gross income.
  • Sole proprietors, independent contractors, and self-employed individuals with no employees who are also located in low-to-moderate income communities are eligible.
  • Non-fraud felons are now eligible to apply for the new PPP loans.
  • Those who have defaulted or are delinquent on federal student loans are eligible to apply for the loans.

These are low-interest rate loans through the Small business Administration where, once you receive the loan proceeds, you can later apply for forgiveness of 100% of the loan amount.  To be eligible for forgiveness, you must spend 60% of the loan proceeds on payroll expenses (salaries, wages, health insurance) and up to 40% on other qualifying expenses.  The overall PPP loan program is scheduled to end on March 31.  For more information on how to apply, connect with the U.S. Small Business Administration.


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New PPP Loans Focus on Smallest Business Owners

The new program focuses on business owners with less than 20 employees.

  • Deadline: Wednesday, February 24, 9 a.m. ET until 5 p.m. on March 9.
  • Gross income vs. net income is used to determine the loan amount.
  • Sole proprietors, independent contractors, and self-employed individuals with no employees located in low-to-moderate income communities are eligible.
  • Non-fraud felons are eligible to apply.
  • People who have defaulted or are delinquent on student loans are eligible to apply.

These low-interest federal loans are potentially 100% forgivable.  Visit for more information.



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Stewart H. Welch, III, CFP®, AEP, is the founder of THE WELCH GROUP, LLC, which specializes in providing fee-only investment management and financial advice to families throughout the United States.  He is the author or co-author of six books, including 50 Rules of Success J.K. Lasser’s New Rules for Estate, Retirement and Tax Planning- 6th Edition (John Wiley & Sons, Inc.); THINK Like a Self-Made Millionaireand 100 Tips for Creating a Champagne Retirement on a Shoestring Budget. For more information, visit The Welch GroupConsult your financial advisor before acting on comments in this article.




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