The Paycheck Protection Program Gets Flexible

    For those looking for help with COVID-19 relief, it looks like more help is on the way. Last week the Paycheck Protection Program (PPP) Flexibility Act of 2020 was passed in Congress. This will improve the PPP experience by making rules for getting loan forgiveness a little easier.

     One major change is the amount of time given to businesses to use the proper loan amount. Originally, business owners had 8 weeks from the time the loan was given to spend 75% of it on Payroll costs. If this obligation was met, it could qualify for complete loan forgiveness. Many felt this was unrealistic considering the need to pay rent and utilities. With the PPP Flexibility Act, borrowers can take up to 24 weeks to spend 60% on Payroll costs and potentially reach the same outcome.

     This new Flexibility Act changes many aspects of how PPP is calculated. It now becomes a more attractive option for COVID-19 relief as it was intended, instead of a burden that had to be used by the end of July. For more information on how this will affect your business, please contact your Qualified Tax Professional.

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