FRANKFORT, Ky. (KY) - Changes to the federal Paycheck Protection Program (PPP) will benefit Kentucky farmers, according to Agriculture Commissioner Ryan Quarles and other farm organizations.
PPP provides forgivable loans to small businesses to pay employees to keep them on the payroll. The Small Business Administration opened an application round with new rules on Jan. 15 after Congress passed a new COVID-19 relief package in December.
According to the American Farm Bureau, highlights of the legislation include:
--Allocating an additional $284 billion in funding for a second round of PPP loans.
--Clarifying that allowable expenses that had been paid for with forgiven PPP loans may be counted as a business deduction for income tax purposes without limitation.
--Cutting in half the qualifying reduction in gross revenue from 50% to 25%.
--Expanding eligible expenses to include personal protective equipment for workers and adaptive costs in addition to previous eligible expenses of payroll, mortgage interest, rent and utilities.
--Changing the metrics for loans from net farm income to gross income for farmers who file taxes as sole proprietors.
“The changes made to the already successful Paycheck Protection Program will enable more Kentucky farm families to participate in this critical COVID-19 relief program,” Quarles said. “It’s much better for both workers and employers to keep people on the payroll than throwing our most vulnerable people into our state’s disastrous unemployment system. I hope every Kentucky farm and agribusiness will take a serious look at the changes to this program and take action to keep employees on the payroll.”
Mark Haney, president of Kentucky Farm Bureau noted, “The latest COVID stimulus package approved by Congress in December updates the Paycheck Protection Program loan program to provide greater access for farmers to secure first and/or second-round loans. It is critical that we do all we can to support our agriculture industry and additional access to PPP loans will provide added certainty during a period that has seen so much uncertainty.”
“The new COVID-19 relief package’s PPP loans recognizes the value of Kentucky’s agricultural producers,” said Tod Griffin, Executive Director of the Agribusiness Association of Kentucky. “Our agribusiness partners stand ready to help them provide for Kentucky’s families.”
The Paycheck Protection Program is administered by the U.S. Small Business Administration and approved lenders. To locate an eligible PPP lender, visit sba.gov/paycheckprotection/find.