Changes to PPP Eligibility and Criminal History

By

Brendan Tuytel

-

Reviewed by

on

March 1, 2021

This article is Tax Professional approved

Group

When the PPP was first released, there were strict rules surrounding criminal history. After facing criticism, changes were made to make the program more widely available. If you’re interested in applying for a PPP but an owner in the business with a criminal history may be affected by these rules, here’s what’s changed.

What's Bench?
Online bookkeeping and tax filing powered by real humans.
Learn More
Friends don’t let friends do their own bookkeeping. Share this article.

I am the text that will be copied.

Contents
Example H2
Example H3
Example H4
Example H5
Example H6
Tired of doing your own books?
Try Bench

Editor’s note: On February 22, President Biden announced changes to the Paycheck Protection Program which we cover in our short video below.



Will my business be reviewed for criminal history?

Any owners with 20% or more equity in the company must be listed on your PPP application and will have their background checked for any criminal history. A business will be immediately ineligible if any listed owners are currently incarcerated, on probation, on parole, or have any current fraud related formal criminal charges. If a business owner or part owner has a prior criminal record which is unrelated to fraud, your business is still eligible to apply.

Misdemeanors and infractions will generally not affect eligibility for a PPP loan unless those charges are related to fraud, bribery, embezzlement, or a false statement in a loan application.

To be able to apply for a PPP loan, all owners must agree to allow the SBA to request criminal record information from criminal justice agencies for the purpose of determining eligibility.

How far back will the SBA look into my criminal history?

Under the old rules, applicants would have their previous five years reviewed for any felonies.

With the change that took place on June 12, applicants will now only have the previous year reviewed. The exception is for convictions of a felony involving fraud, bribery, embezzlement, or a false statement in a loan application. If an owner was convicted of any of those crimes in the previous five years, the business would be ineligible for a PPP loan.

I’m now eligible for a PPP loan, how do I apply?

You can review our list of lenders currently accepting applications which includes local banks and FinTech lenders like BlueVine or Lendio. Starting to collect the necessary documents now will make filling out an online application quick and easy.

More PPP resources

‍

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. Bench assumes no liability for actions taken in reliance upon the information contained herein.
Friends don’t let friends do their own bookkeeping. Share this article.

I am the text that will be copied.

Related Posts

Operations

Need Help With Cash Flow? Try These Tools

Simple tools tailor-made for small businesses to get a better handle on cash flow.

Learn more →
Operations

SUI Definition (And How to Keep Your SUI Rate Low)

Protecting your SUI rate is a surefire way to save your business money right now, and as you grow.

Learn more →
Operations

8 Grant Programs for Veteran-Owned Businesses

Veterans are, by and large, an entrepreneurial group. Here are the top 8 grants, training programs, and funding resources for veterans looking to start or grow a business.

Learn more →

Join over 140,000 fellow entrepreneurs who receive expert advice for their small business finances

Get a regular dose of educational guides and resources curated from the experts at Bench to help you confidently make the right decisions to grow your business. No spam. Unsubscribe at any time.

Subscribe