Who is an “eligible recipient” able to apply for Payroll Protection Program (PPP) loans under the Consolidated Appropriations Act of 2021?
PPP “eligible recipients” include for-profit businesses, non-profit organizations, housing cooperatives, veterans’ organizations, tribal businesses, self-employed individuals, sole proprietors, independent contractors, and small agricultural cooperatives.
Publicly traded companies, with some limited exceptions, are excluded from the definition of “eligible recipient.” Also excluded from the definition are those engaged in political or lobbying activities, including, but not limited to, entities organized for research of public policy or political strategy, as well as any entity organized under the laws of the People’s Republic of China and Hong Kong or any entity that has significant operations in China or Hong Kong and owns, directly or indirectly, 20 percent of the economic interest of such a business.
In addition to the foregoing requirements, an eligible recipient must:
- have been in operation on or prior to February 15, 2020;
- have no more than 300 employees (for businesses with multiple locations, no more than 300 per physical location); and
- have experienced 25 percent or greater reduction in gross receipts during a specific quarter in 2020 compared to the same quarter in 2019 (alternative comparative options are available for businesses that were not active in most or all of 2019 but were active before February 15, 2020).