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John,
Earlier this week, we sent an email with details about PPP loan forgiveness and how to apply. Yesterday, there was another major development in Washington related to the Paycheck Protection Program. The Senate passed the Paycheck Protection Program Flexibility Act, providing more clarity on how these funds may be used and who qualifies for loan forgiveness. Attached is a summary of the bill, as well as the full text and the loan forgiveness application from our earlier email. We advised small business owners to submit applications for PPP funding with haste, and the same applies for applying for loan forgiveness.

TAKE A FEW MINUTES WITH THIS, AND DON’T UNDERESTIMATE THE POTENTIAL SIGNIFICANCE TO YOUR INDIVIDUAL BUSINESS. THIS DRAMATICALLY IMPROVES YOUR FLEXIBILITY IN HOW YOU UTILIZE FUNDS. THEY HEARD THE FEEDBACK AND FRUSTRATION (yes, they listened and responded, even in DC!) AND MADE SOME BADLY NEEDED CHANGES.

Good luck, and again...Please hang in there. We are fighting for you and I will take that fight to Capitol Hill in just a few months!

Following is a summary of the legislation, compiled by the AICPA:
* PPP borrowers can choose to extend the eight-week period to 24 weeks, or they can keep the original eight-week period. This flexibility is designed to make it easier for more borrowers to reach full, or almost full, forgiveness.
* The payroll expenditure requirement drops to 60% from 75% but is now a cliff, meaning that borrowers must spend at least 60% on payroll or none of the loan will be forgiven. Currently, a borrower is required to reduce the amount eligible for forgiveness if less than 75% of eligible funds are used for payroll costs, but forgiveness isn’t eliminated if the 75% threshold isn’t met.
* Borrowers can use the 24-week period to restore their workforce levels and wages to the pre-pandemic levels required for full forgiveness. This must be done by Dec. 31, a change from the previous deadline of June 30.
* The legislation includes two new exceptions allowing borrowers to achieve full PPP loan forgiveness even if they don’t fully restore their workforce. Previous guidance already allowed borrowers to exclude from those calculations employees who turned down good faith offers to be rehired at the same hours and wages as before the pandemic. The new bill allows borrowers to adjust because they could not find qualified employees or were unable to restore business operations to Feb. 15, 2020, levels due to COVID-19 related operating restrictions.
* Borrowers now have five years to repay the loan instead of two. The interest rate remains at 1%.
* The bill allows businesses that took a PPP loan to also delay payment of their payroll taxes, which was prohibited under the CARES Act.

Click here for full text of PPP Flexibility bill ([link removed])
Click here for PPP forgiveness application ([link removed])
Stay well,

-Brian
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