The President just signed into legislation the Paycheck Protection Program Flexibility Act of 2020 (“Act”), which results in significant changes to the Payroll Protection Program (“PPP”). The payroll expenditure requirement under the Act drops from 75% to 60%. One notable change is that 60% of the funds must be used for payroll or the loan is not eligible at all for forgiveness.
Significantly, existing PPP borrowers can elect to extend the eight-week measurement period to twenty four weeks. The original eight-week period may continue to be applicable to existing PPP borrowers. New PPP borrowers will have a twenty four-week measurement period but this period may not be extended beyond Dec. 31, 2020. This flexibility in forgiveness offers unique planning opportunities as it changes the landscape completely.
New guidance is expected to be issued shortly. If you already have received PPP, I think that it is of paramount importance to set up an appointment to discuss how these changes under the Act will affect your business. If you have not received PPP funds, time is running out and there are limited funds still available.
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Join the webinar we will present with the Greater Atlantic City Chamber on this topic on June 10 at 11 a.m.
Click here to register for the free webinar.
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Questions? Please reach out anytime to Eric A. Browndorf, Esq. Chairman of the Bankruptcy & Financial Restructuring practice group at ebrowndorf@cooperlevenson.com or Jarad K. Stiles, Esq., LL.M., of the Tax Law, Estate Planning & Administration, and Bankruptcy & Financial Restructuring practice groups at jstiles@cooperlevenson.com.
