On June 5, 2020, President Trump signed into law the Paycheck Protection Program Flexibility Act (PPPFA) that addresses concerns expressed by the small business community. In a recent Forbes.com article it outlines the changes and how this new law will benefit small businesses and the previous concerns with the original PPP under the CARES Act:
- PPPFA changes the amount of loan needed for payroll to 60%
- PPPFA extends the time period to use funds from 8 to 24 weeks
- PPPFA pushes back a June 30 deadline to rehire workers to December 31, 2020
- PPPFA eases rehire requirements
- PPPFA extends the repayment term from 2 years to 5
A Denver Business Journal (DBJ) Article outlines these same PPPFA rules and discusses how the new law changes the importance of bonuses. In the former law, businesses found they needed to spend more on payroll – through bonuses and hazard pay – than they normally would in order to get to the threshold to meet the forgiveness guidelines. With this new PPPFA law, there is no longer the need for this. Read the full DBJ article HERE.