On December 27, 2020 the President signed the next stimulus bill that Congress passed on December 21. The legislation extends unemployment assistance not only for employees but also for independent contractors and other self-employed individuals for 11 weeks. The bill (H.R. 133) includes the “Continued Assistance for Unemployed Workers Act of 2020,” which provides for an extension of the CARES Act unemployment provisions from December 31, 2020 until March 14, 2021, including the provisions that had created a new form of benefits for all self-employed individuals: pandemic unemployment assistance (PUA).
Significantly, the law includes Additional Allowable Uses of PPP Funds. The Act authorized the following additional permissible nonpayroll costs:
Covered operations expenditures: payments for any business software or cloud computing service that facilitates business operations, product or service delivery, the processing payment, or tracking of payroll expenses, human resources, sales and billing functions, or accounting or tacking of supplies, inventory, records, and expenses.
Covered property damage costs: costs related to property damage and vandalism or looting due to public disturbances that occurred during 2020 that was not covered by insurance or other compensation.
Covered supplier costs: expenditures made by an entity to a supplier of goods for the supply of goods that 1) are essential to the operations of the entity at the time at which the expenditure is made, and 2) is made pursuant to a contract or purchase order that is in effect at any time before the covered period of the PPP loan, or with respect to perishable goods, in effect before or at any time during the covered period with respect to the PPP loan.
Covered worker protection expenditures: costs related to personal protective equipment (PPE), which may include a wide range of operating or capital expenditures, including, but not limited to, drive through window facilities, physical barriers, indoor, outdoor or combined commercial real property; or health screening capabilities.
It appears that the new eligible expenses have retroactive effect, meaning that the first round of PPP loans may now justify and claim forgiveness on these additional nonpayroll expenses. However, the Act excludes these additional expenses from borrowers who have already received loan forgiveness as of the date of the Act. Additionally, the Act specifically excludes residential real property or intangible property costs from these added eligible PPP expenses.
Based on the above, FeverWarn purchases by your organization will qualify as an allowable use of PPP funds.