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Bipartisan legislation has been introduced to increase the equity for "Schedule C Filers"—independent contractors, sole-proprietors, and the self-employed—who took out Paycheck Protection Program (PPP) loans prior to March 2021. S. 1249, the PPP Flexibility for Farmers, Ranchers, and the Self-Employed Act—cosponsored by Senators Cardin (D-MD), Lankford (R-OK), Baldwin (D-WI), Collins (R-ME), King (I-ME), Portman (R-OH) and Marshall (D-OH)—allows those borrowers to receive the difference in loan amount they received and the loan amount they would currently qualify for under the new calculation method.
Schedule C filers initially were required to use net profits—which deducts business expenses from the total—when calculating their PPP loan amounts, which does not accurately reflect their income and resulted in lower loan amounts for many. In March, President Biden announced an important change to the program, allowing Schedule C filers to use either net profits or gross income—which does not require deducting business expenses—when calculating their loan amount. However, that change was not retroactive, leaving borrowers from before March 2021 with lower loan amounts than they would qualify for under the new calculation method.
S. 1249 fixes that issue by allowing those borrowers to apply for and receive the difference in loan amount they qualified for originally, and would qualify for now using gross income to base their calculation off of. NAR's membership includes a large number of independent contractors and sole proprietors, and NAR sent a thank-you letter to the cosponsors in support of the legislation.