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Economic Injury Disaster Loan (EIDL) Program Updates


September 10, 2021

Dear Clients, Colleagues and Friends,

On September 8, 2021, the U.S. Small Business Administration announced that it is increasing the maximum amount small businesses and non-profit organizations can borrow through its COVID-19 Economic Injury Disaster Loan (EIDL) program. Starting on October 8, 2021, for loans greater than $500,000, the SBA is increasing the loan limit from $500,000 to $2 million.
In addition to the maximum limit change, the SBA announced the following changes to the program:

  • Use of funds was expanded to include payment and pre-payment of business non-federal debt incurred at any time (past or future) and payment of federal debt
  • Extended the deferment period to 24 months from origination for all loans (existing loans with a less than 24-month deferment will be adjusted)
  • Affiliation requirements simplified to: “an affiliate is a business that you control or in which you have 50% of more ownership”
  • Developed an additional path to meet program size standards for businesses assigned a NAICS code beginning with 61, 71, 72, 213, 3121, 315, 448, 451, 481, 485, 487, 511, 512, 515, 532, or 812
  • Exclusivity Period: From September 8, 2021 to October 8, 2021, the above policy changes will be applicable to applications for <$500K while applications for >$500K will not be approved and therefore receive the policy changes until October 8, 2021
  • Added $10 million limit on maximum aggregate COVID EIDL loans to a single corporate group. Entities are part of a single corporate group if they are majority owned, directly or indirectly, by a common parent.

For loans greater than $500,000, applications will not be approved until after the exclusivity period ends on October 8, 2021, but they can be submitted before then. Applicants can choose to apply for $500,000 or under immediately and then for over $500,000 funds after the exclusivity period ends, or they can choose to apply immediately for all desired funds above $500,000 and have their application wait for approval starting October 8, 2021.
For all of our COVID-19 updates, please visit our website at www.pntax.com and our COVID-19 updates page at https://www.pntax.com/covid-19/.
If you have any questions or need further information, please contact your Presti & Naegele professional directly, or dial 212-736-0055 for immediate assistance.

Presti & Naegele