AICPA Urges Congress to Extend PPP Deadline
The AICPA called on Congress to extend the application period for the Paycheck Protection Program (PPP) by at least 60 days past the current deadline of March 31.
One of the concerns expressed by the AICPA is that many PPP applications have had problems in the Small Business Administration (SBA) PPP processing platform, causing some applications to be refused due to system problems and catching thousands of others in validation checks designed to prevent fraudulent applications from being approved. The validation checks can produce dozens of error codes, many of which require significant manual labor to rectify.
Another issue of concern is that the SBA has not yet released guidance detailing the Biden administration’s changes of the PPP loan calculation formula for sole proprietors, self-employed individuals and independent contractors, although the SBA is expected to release the guidance this week. The administration had announced the changes would be made to help those individuals receive more financial support. The Biden administration also stated that the SBA would accept PPP applicants only from businesses with fewer than 20 employees during a two-week period that started Feb. 24 and ends March 9.
In a press release, AICPA President and CEO Barry Melancon, CPA, CGMA commended the Biden administration’s efforts to make the PPP more inclusive and accessible to underserved businesses but expressed concern that the changes make it more difficult for the smallest business entities to meet the March 31 deadline.
Despite the processing issues, the SBA approved nearly 2.2 million PPP loans for a total of $156 billion from the program’s reopening on Jan. 11 through Feb. 28. Congress allocated $284.5 billion to the PPP in the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, P.L. 116-260.
The American Rescue Plan Act of 2021, H.R. 1319, expected to be signed by Biden before March 14, provides $7.25 billion more in PPP funds but does not extend the March 31 deadline. The AICPA recommended in its press release that Congress extend the deadline in a separate vote.