TRENTON, NJ — Gov. Phil Murphy announced today that loans received through the federal Paycheck Protection Program (PPP) will not be subject to state taxes and that all expenses paid through PPP funds will be tax-deductible.
“This is another layer of protection our business owners need to help them get through this pandemic,” Murphy said during his press briefing via ZOOM on Wednesday, Feb. 10.
According to the PPP figures released by the SBA on Feb. 8, more than 30,000 New Jersey businesses have received $2.9 billion in PPP loans. The average PPP loan size is $78,000.
- $50K and Under: 69.7% of the loans approved, and 15.9% of the funded amount
- $50K: $100K: 12.6% of the loans approved, and 11.6% of the funded amount
- $100K: $150K: 6.5% of the loans approved, and 10.3% of the funded amount
- $150K: $350K: 6.8% of the loans approved, and 19.7% of the funded amount
- $350K - $1M: 3.5% of the loans approved, and 24.8% of the funded amount
- $1M - $2M: 0.9% of the loans approved, and 17.2% of the funded amount
Meanwhile, SBA and its lender partners continue to take more steps to improve Paycheck Protection Program, which the agency says has shown a significant increase to underserved entrepreneurs. The SBA says that is working to increase equitable access to underserved small businesses, to assure the integrity of the program (to prevent fraud), and to promote rapid and efficient distribution of funds.
This week, the SBA hit a major milestone of approving $103 billion of PPP funds to more than 1.4 million small businesses nationwide. The smallest businesses are indeed getting access to funding; 82% of all loans are going to companies requesting less than $100K. The SBA has also increased its partnerships with Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) that help to extend economic relief to minority communities and underserved populations.
The SBA is also following through on its commitment to take additional steps towards improving the speed to resolve data mismatches and eligibility concerns so that small businesses have as much time as possible to access much needed PPP funds, while maintaining the integrity of the program. Three important changes will enable lenders to directly certify eligibility of borrowers for First Draw and Second Draw loan applications that receive validation errors messages, thereby ensuring that businesses in need of funds and are eligible receive them can get the loans as quickly as possible. The SBA also said it will create additional communication channels with lenders to assure that the agency is constantly improving equity, speed, and integrity of the program.
“The Paycheck Protection Program is targeting the smallest of small businesses and providing economic relief at a time when they are desperate for money to stay afloat,” said Rohit Arora, CEO of Biz2Credit, one of the nation's leading experts in small business finance. “This was not the case in the first round of the program last year. The SBA is doing a good job of responding to the needs of the smallest firms, including Black-owned businesses, to see that they get the funding they need to survive."
The industries receiving the most approvals nationally are:
- The Accommodation & Food Service industry (18%);
- Construction (14%);
- Manufacturing (11%);
- Professional, Scientific & Technical Services (11%);
- Health Care & Social Assistance (10%)
To view the governor's press briefing today, click here.
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