Who can apply for the SBA grant or PPP loans? Is my business eligible? (2021 updates)

Important PPP update for 2021

On December 22, 2020, Congress passed a bill renewing funding under the CARES Act, including an additional $284 billion earmarked for America’s struggling small businesses. The rules and application process for PPP loans and forgiveness have been modified, with more businesses eligible for PPP loans, more expenses forgivable, and a simplified application process. Also there is provision for “second draw” PPP loans for businesses that received PPP funding in 2020.


In this 3-minute read:

  • What kinds of businesses are eligible for Paycheck Protection Program loans?
  • What if I have multiple locations?
  • What if I’m a sole proprietor, independent contractor, or self-employed? Can I apply?
  • What if I own a “mom and pop” shop?
  • What about second draw PPP loans?

During the COVID-19 pandemic, businesses across the world are experiencing financial strain with most people following recommendations to stay home and adhere to social distancing guidelines. 

In order to help strengthen the national economy, the federal government has enacted the CARES Act, which allocates $2 trillion to help businesses and individuals to get through the next couple of months. 

Womply has made email marketing truly automatic for busy small business owners and all types of independent contractors. Learn more, plus get free reputation monitoring and customer insights when you sign up for Womply Free!

The Paycheck Protection Program (PPP) is providing loans for up to $10 million to small businesses under the CARES Act. Eligible businesses can already start applying for these loans (and we recommend you apply NOW if you haven’t already).

Are all small businesses eligible for PPP loans?

Small businesses with fewer than 500 employees whose principal residences are in the United States are eligible for PPP loans. Your business also must have been in operation as of February 15, 2020. 

Beyond traditional small local businesses, the following types of businesses and organizations are also included:

In order to verify eligibility, you must provide the required documentation for PPP loans during the loan application and approval process. 

Is my business eligible for a PPP loan if I have multiple locations?

If your business has multiple locations and meets all of the requirements for eligibility, you can apply for a PPP loan. Depending on how your business locations are set up, under one tax ID or with multiple tax IDs, you may need to submit more than one application. 

If you have one tax ID for all of your locations, you will only submit one application. 

If you have multiple tax IDs, you should submit an application for each eligible EIN, regardless of how many locations you operate. 

Each different EIN must meet the eligibility requirements outlined above. 

What if I own a mom and pop shop? Am I still eligible for a PPP loan?

Mom and pop shops are definitely eligible for PPP loans, so long as your business meets all of the requirements outlined above. Whether you are the sole owner with no employees or you have multiple employees (so long as it’s fewer than 500), you can apply for PPP loans to help get your business through this crisis. 

Read more about independent contractors, sole proprietors, and self-employed individuals applying for PPP loans.

Can “small business concerns” with more than 500 employees get PPP loans?

Businesses that exceed 500 employees may be eligible in certain industries. Small business concerns can be eligible borrowers even if they have more than 500 employees, as long as they satisfy the existing statutory and regulatory definition of a “small business concern” under section 3 of the Small Business Act, 15 U.S.C. 632. A business can qualify if it meets the SBA employee-based or revenue-based size standard corresponding to its primary industry. Go to www.sba.gov/size for the industry size standards.

Additionally, a business can qualify for the Paycheck Protection Program as a small business concern if it met both tests in SBA’s “alternative size standard” as of March 27, 2020: (1) maximum tangible net worth of the business is not more than $15 million; and (2) the average net income after Federal income taxes (excluding any carry-over losses) of the business for the two full fiscal years before the date of the application is not more than $5 million. 

What if I’m in a Partnership? How do we apply for a PPP loan?

If you are a partner in a partnership, you may not submit a separate PPP loan application for yourself as a self-employed individual. Instead, the self-employment income of general active partners may be reported as a payroll cost, up to $100,000 annualized, on a PPP loan application filed by or on behalf of the partnership. Please see the treasury department’s PPP supplement for full details.

Who is eligible for a “second-draw” PPP loan in 2021?

A second draw PPP loan is now authorized for certain businesses (and contractors, sole proprietors, and self-employed individuals) for 2021.

If you DID get PPP funding in 2020, you may qualify for a second draw of forgivable PPP stimulus money in 2021, if you:

  • Your business has 300 or fewer employees, and
  • Your business experienced a 25% revenue reduction in 2020 relative to 2019, and
  • Your business has received a “first draw” PPP loan and has used, or will use, the full amount of the initial PPP funding on or before the expected date on which the Second Draw PPP Loan is disbursed to you, and
  • You have spent (or WILL SPEND by the time you get your second draw funding) the full amount of your first PPP Loan on eligible expenses under the PPP rules.

For more details of eligibility for second draw PPP loans, including certain exclusions, see our FAQ guide about eligibility requirements for Second Draw PPP loans.)

Helpful PPP loan FAQs and resources

Here are some more helpful articles to help you through your PPP loan application process:

Win new customers and build loyalty with your existing customers with Womply Email Marketing

Womply has made Email Marketing truly automatic for busy small business owners, independent contractors, and sole proprietors. Womply helps you turn customers into regulars and get more repeat business with targeted emails that send automatically when customers transact with you. Build customer loyalty and revenue, and get more repeat business with just a few clicks! 

Learn more, plus get free reputation monitoring and customer insights when you sign up for Womply Free!

Recent Articles

9 Atlanta area events that can be great for your small business in 2022

In this 5-minute read: 9 events in Atlanta, GA in 2022 that your business should know about Start your year …

Read More

25 free business listing websites every small or local business should be on (Updated for 2022!)

Be sure to claim your company’s free listings on these sites so more customers can find your business. 

Read More

9 events that every Houston, TX area small business should know about in 2022

In this 5-minute read: 9 local events that Houston small businesses should take advantage of this year Attending events, business …

Read More

Small business events in Chicago: 8 ways to grow and market your business in 2022

In this 5-minute read: 8 Chicago events to add to your 2022 business calendar Wherever your business is located, you …

Read More

10 2022 Washington DC area events that can be great for your small business

In this 5-minute read: 10 events that Washington DC area businesses need to know about this year Which DC events …

Read More

5 Orlando area events in 2022 your small business should take advantage of

In this 5-minute read: 5 2022 events in Orlando, FL that your business needs to know about Which events may …

Read More

See why Womply is the #1 marketing and CRM solution used by 500,000+ businesses.