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Congress Continues to Debate Possible New Stimulus Package to Assist Businesses Hurt by COVID-19

If eventually agreed upon, the HEALS Act will include—among other things—a new round of the Paycheck Protection Program (PPP) to provide relief to small businesses.

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Insights  <  Congress Continues to Debate Possible New Stimulus Package to Assist Businesses Hurt by COVID-19

If eventually agreed upon, the HEALS Act will include—among other things—a new round of the Paycheck Protection Program (PPP) to provide relief to small businesses.

While a second large economic stimulus bill has been in the works this week in Congress—known as the HEALS Act (Health, Economic Assistance, Liability Protection and Schools Act) and possibly slated for Congressional approval soon—recent reports indicate the partisan debate has the two sides far apart on what should ultimately be included in the package. If eventually agreed upon, the HEALS Act will include—among other things—a new round of the Paycheck Protection Program (PPP) to provide relief to small businesses.

According to published reports, the disagreement—which some are now labeling a stalemate—is a partisan one between Democrats and Republicans in Congress. Democrats in Congress had previously proposed an additional $3 trillion relief package that reportedly included $1 trillion in aid to cash-strapped states and municipalities who have been hit hard by the crisis. Republicans and the White House have objected to that level of government relief and have in turn responded with the proposed HEALS Act, said to be valued at $1 trillion. This is where negotiations appear to be at the present time.

While the debate over the HEALS Act continues, the Small Business Administration (SBA) is expected to soon begin accepting forgiveness applications from those businesses that took advantage of the first round of PPP loans. Published reports indicate that the SBA could begin accepting forgiveness applications from businesses that received PPP on August 10, although the SBA also indicated the launch of the applications could be delayed if the new legislation changes the forgiveness process in ways that require changes to the new platform. The widely used PPP offered loans designed to provide a direct incentive for small businesses to keep their workers on the payroll, and the SBA will fully forgive loans if the funds are used for payroll costs, interest on mortgages, rent and utilities.

The HEALS Act would offer a number of new provisions designed to assist businesses and individuals through what still is a challenging time caused by this global health pandemic.

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Disclaimer: Any written tax content, comments, or advice contained in this article is limited to the matters specifically set forth herein. Such content, comments, or advice may be based on tax statutes, regulations, and administrative and judicial interpretations thereof and we have no obligation to update any content, comments or advice for retroactive or prospective changes to such authorities. This communication is not intended to address the potential application of penalties and interest, for which the taxpayer is responsible, that may be imposed for non-compliance with tax law.

Disclaimer:  The contents of this resource are for general informational purposes only. While every effort has been made to ensure its accuracy, the information is provided “as is” and no representations are made that the content is error-free. We have no obligation to update any content, comments or other information for retroactive or prospective interpretations or guidance provided by regulators, financial institutions or others. The information is not intended to constitute legal advice or replace the advice of a qualified professional. There are areas of the CARES Act where additional clarification from the Treasury Department and the SBA is needed. Your judgment and interpretation of the act may be needed. Users should consult with their legal counsel and representatives of the lending institution regarding the proper completion of their application and supporting documentation.

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