On June 4, 2020, the H.R.7010, the Paycheck Protection Program Flexibility Act of 2020 was passed in the Senate by unanimous consent. This bill amends the PPP and provides small business recipients with necessary flexibility to receive the forgivable loans they need to keep their businesses open and their employees on their payrolls. Specifically, H.R.7010:
- Increases the loan forgiveness period from eight weeks to 24 weeks;
- Changes the 75/25 payroll / non-payroll requirement for loan forgiveness to 60/40
- Increases the loan repayment period from two to five years;
- Allows payroll tax deferral for PPP recipients; and
- Extends the June 30 rehiring deadline to December 31, 2020.
The full text of this legislation is available here. The bill had previously passed the U.S. House of Representatives and was sent to President Trump for his signature. Following its enactment, the SBA will be required to update its loan forgiveness application and process.