Paycheck Protection Program Flexibility Act
The Government signed into law the Paycheck Protection Program Flexibility Act (PPPFA) in an attempt to address many concerns expressed by the small business community around the Paycheck Protection Program (PPP) aimed at providing COVID-19 relief.
Below are the highlights in the new law:
- Small businesses would have to spend 60% of the loan money on payroll instead of the previous 75%.
- There is now a forgiveness period of 24 weeks, a change from 8 weeks.
- The original deadline of June 30th to rehire workers PPPFA pushed back to December 31, 2020.
- The headcount calculation won’t be negatively impacted by people not wanting to come back if you can substantiate you have offered them work and they have declined.
- It would also push back the timeline for repaying loans, and allow companies that get loan forgiveness to defer payroll taxes through the end of the year.