Important changes to PPP guidelines (Updated information until June 30, 2020)

 

Earlier this month Congress passed the Paycheck Protection Program Flexibility Act, which will make it easier for small business owners who have received a Paycheck Protection Program (PPP) loan to qualify for loan forgiveness. Some key changes include:

  • Extension of forgiveness period from 8 to 24 weeks
  • A decrease in the minimum amount that must be spent on payroll from 75% to 60%
  • Increased loan maturity from two to five years for new PPP loans
  • Extended deadline to rehire staff from 6/30/20 to 12/31/20
  • Reduction in the workforce to pre-pandemic levels won’t impact forgiveness if:

o   Unable to hire a former employee

o   Able to demonstrate an inability to rehire similarly qualified employees

o   Demonstrate inability to return to the same level of business activity before 2/15/20

  • New borrowers have 5 years at 1% (lender and borrower must agree) to repay an unforgivable portion of the loan
  • Delayed payment of payroll taxes

Loan approval must be received prior to June 30, 2020  for PPP loans.  The program ends on that date.

2020-06-16T17:53:08-07:00June 16th, 2020|Categories: News|