The Sentinel

President Trump Signs Paycheck Protection Program Flexibility Act of 2020

June 7, 2020

On Friday, President Donald Trump signed legislation to amend the small business forgivable loan program known as the Paycheck Protection Program that was created in response to the COVID-19 pandemic. The newly signed Paycheck Protection Program Flexibility Act of 2020 – which received nearly unanimous support in Congress (with only one dissenting vote in the U.S. House) reshapes the March law, generally making it easier for businesses to qualify for loan forgiveness:

 

  • It extends the loan forgiveness period from 8 to 24 weeks
  • Replaces the 75/25 rule with a 60/40 rule, regarding the amount of loan proceeds required to be utilized for payroll costs
  • All new PPP loans will receive a 5-year maturity rate (existing loans have a 2-year maturity rate)
  • The bill allows businesses that receive forgiveness to also receive payroll tax deferment
  • It ensures small businesses won’t be penalized by high unemployment benefits
  • It creates a safe harbor for businesses that are required to open at only 50 percent capacity

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Founded in 1916, the Pennsylvania Chamber of Business and Industry is the state's largest broad-based business association, with its membership comprising businesses of all sizes and across all industry sectors. The PA Chamber is The Statewide Voice of BusinessTM.