On June 5, President Trump signed into law the Paycheck Protection Program Flexibility Act (PPPFA), which makes changes to the Paycheck Protection Program (PPP) to make it more user friendly for business who have struggled to meet the terms of the loan forgiveness provisions—among other things. The President's signing comes on the heels of the Senate passing the legislation on June 3. A similar bill was also passed in the House last week.
As previously reported, this legislation aims to address a number of challenges that businesses were facing when utilizing the PPP, including:
- Allowing forgiveness for expenses beyond the 8-week covered period to up to 24 weeks.
- Easing restrictions by limiting non-payroll expenses to 40% of loan proceeds, up from 25%.
- Extending the loan program availability to December 31, 2020.
- Permitting all loans to amortize over 5 years, which is up from 2 years.
- Allowing full access to payroll tax deferment for businesses that take PPP loans.
- Providing a rehiring safe harbor for businesses unable to rehire employees.
Businesses interest in PPP has slowed over the past few weeks and there is over $100 billion of available funds remaining in the program. However, these changes may generate a renewed interest in the program.
For more information on NMHC’s advocacy work during the COVID-19 crisis, please visit the NMHC COVID-19 Hub.
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