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The Economic Aid Act, signed into law on December 27, 2020, repealed the Section 1110(e)(6) of the CARES Act which required SBA to deduct the amount of any Economic Injury Disaster Loan (EIDL) Advance (typically $10,000) received by a PPP Borrower from that Borrower’s PPP Loan Forgiveness amount.

On January 8, 2021, SBA issued Procedural Notice 5000-20075 implementing the repeal. For any PPP Loans forgiven on or after December 29, 2020, SBA will no longer deduct EIDL Advances. For PPP Loans where SBA deducted an EIDL Advance, SBA will automatically remit a reconciliation payment to the PPP Lender for that deduction, plus interest through the remittance date. Reconciliation payments will be made to the ACH account identified by the PPP Lender in the Forgiveness Platform. PPP Lenders are not required to request remittance of the reconciliation payment.

If you previously received a PPP loan, your PPP Lender should be reaching out to you to notify you of the reconciliation payment. They will also be responsible for re-amortizing your loan and letting you know the next payment due date, or advising you whether the loan has been paid in full, whichever is applicable. If the amount remitted by SBA to the PPP Lender exceeds the remaining principal balance of the PPP Loan because you made a payment on the Loan, the PPP lender must remit the excess amount, including accrued interest paid by you, to you.

If you haven't heard from you lender, you should reach out to them for more information.

If you are interested in applying for a PPP loan, you can find the application and instructions on the SBA website. You can find more information about applying for an EIDL loan here.

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