Small businesses that received Paycheck Protection Program loans will now have more flexibility to use the funding in a bill passed last night by Congress. President Trump is expected to sign the bill into law soon.
Among changes, the bill will:
-Extend the timeframe that businesses must use funds from eight weeks to 24 weeks after a loan is issued, or through Dec. 31, 2020, whichever comes first.
-Give businesses until Dec. 31, 2020, to restore staffing or salary levels if they had been reduced to qualify for full loan forgiveness.
-Maintain forgiveness amounts for companies that can document that they could not rehire workers employed as of Feb. 15, 2020, and that they could not find similarly qualified workers by the end of the year.
-Reduces the amount of funding that must be used toward payroll from 75 percent to 60 percent, allowing small businesses to spend more on non-payroll costs, such as rent and utilities.
Small business owners who received PPP funding and have additional questions about the modifications should inquire with their lender.
The Small Business Administration is expected to provide additional guidance on its COVID-19 webpage: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources