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Paycheck Protection Flexibility Act signed into law

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President Trump has signed the Paycheck Protection Flexibility Act into law, extending the amount of time Paycheck Protection Program (PPP) loan recipients have to spend their funds from eight weeks to 24 weeks. It also lowers the portion of funds borrowers must spend on payroll costs to 60 percent, down from 75 percent in order to qualify for forgiveness of the full PPP loan amount.

Other changes include:

  • Extending the program sunset to December 31, 2020
  • Extending the length of time businesses can use the loans from eight to 24 weeks, or until the end of the year (whichever is earlier) (note: businesses that have used it in eight weeks will not be penalized)
  • Makes PPP recipient businesses eligible for the delayed payment of employer payroll taxes in the CARES Act; and 
  • Creates an exception to the rehire requirement for employees that were let go due to COVID-19 if a business can show that they are unable to return to normal operations due to compliance with federal government rules or guidelines based on maintaining sanitation, social distancing, or worker/customer safety requirements related to COVID-19. 

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