Good News About The Paycheck Protection Flexibility Act (in Plain English)
June 9, 2020
A few weeks back, we wrote on the PPP; how to decide if it’s right for your business and take advantage of it if it is.
Since then, the Paycheck Protection Flexibility Act was passed to help small businesses get back on their feet and provide the best chance of getting their loans forgiven.
This brings some much needed good news if you’ve decided to apply or already accepted the loan, and were feeling stressed about the guidelines for getting it forgiven.
Check out this blog for full details on the Flex Act and see our Plain English summary of the benefits below:In a nutshell, the new act:
- Buys you more time with the loan period being extended from 8 to 24 weeks.
- Frees you up to spend more money on other costs crucial to your business’ survival (such as commercial leases and other overhead costs) by dropping the amount you must spend on payroll from 75% to 60%.
- Allows more time to ease your employees back in instead of having to rush to bring employees back when it still may not be feasible/needed/safe to do so.
- Gives two new exceptions to qualifying for full forgiveness if you cannot restore your workforce: not being able to find qualified employees or inability to get your business operations back up to need as many people as before.
- Extends the timeframe for repaying the loan from two years to five. This takes the burden of repayment down a notch if you were unable to qualify for full forgiveness.
- Helps you shore up resources by allowing you to delay paying payroll taxes.
For many small business owners, these changes bring a sigh of relief and a boost of hope as they try to put the pieces of their business back together and adapt to a new marketplace.
For detailed information and updates, check here.