House Passes Bill That Eases PPP
Forgiveness Requirements

COVID-19 Business Update

The U.S. House’s recently approved legislation has made it easier for small businesses and other recipients of Paycheck Protection Program (PPP) funding to qualify for forgiveness of these loans.
The House bill:

• Extends from eight weeks to 24 weeks the time PPP recipients have to spend their funds.
• Lowers to 60% from 75% the portion of PPP funds borrowers must spend on payroll costs to qualify for full loan forgiveness. That change would allow borrowers to direct more funds to costs such as rent and utilities.
• Doubles the minimum term period for the loans to five years from two years.
• Allows companies whose loans are forgiven to delay payment of payroll taxes.

A bill currently in the Senate would double the covered period of PPP spending from 8 to 16 weeks but would not change the 75% payroll cost requirement.

Tax and legal experts and a variety of business organizations applauded the passage of the House bill, noting its bipartisan nature. We look forward to a final bipartisan bill when it is presented to.the Senate.

The information presented here should not be construed as legal, tax, accounting, or valuation advice. No one should act on such information without appropriate professional advice and after a thorough examination of the particular situation.