Paycheck Protection Program Flexibility Act (PPPFA)
Based on numerous complaints regarding the Paycheck Protection Program (PPP), Congress passed the Paycheck Protection Program Flexibility Act (PPPFA), which has now been signed into law. The PPPFA simplifies the PPP process and makes it easier for small businesses to qualify for loan forgiveness:
- Provides more time for business to spend loan funds on expenditures deemed “forgivable.” It extends from 8 weeks to 24 weeks, or 12/31/2020, whichever shall first occur, the time businesses have to spend the loan amount.
- Provides more flexibility to use loan funds for expenses other than payroll. It decreases the percentage of the loan owners must spend on payroll expenses from 75% to 60%.
- Provides more time to payback any unforgiven loan amount. It extends the time a borrower has to pay back any unforgiven loan amount to 5 years; it was previously 2 years. The loan carries a 1% interest rate.
- Provides a longer deferral period. It extends the loan repayment deferral period from 6 months to the date when the Small Business Administration reimburses lenders for the forgivable amount of the loans it has provided to borrowers.
- Provides more time to rehire employees. It extends the deadline to rehire employees who were laid off during the crisis, at previous salary levels, from June 30 to December 31, 2020 in order to avoid a reduction in loan forgiveness.
Please feel free to contact me if you have any questions or if I can assist you in any other way. beth@eedwardslaw.com 203-544-9945.
Elizabeth A. Edwards
Law Offices of Elizabeth A. Edwards, LLC\
462 Danbury Rd.
Wilton CT 06897
203-544-9945
