Paycheck Protection Program Flexibility Act or PPPFA will provide PPP borrowers benefits and additional flexibility : Holthouse Carlin & Van Trigt LLP
Mortgage interest Summary Of Paycheck Protection Program Flexibility Act are allowable and are eligible for forgiveness if the business mortgage was obligated prior to February 15, 2020. Mortgage interest payments to a related party are not eligible for forgiveness. Million of PPP loan proceeds will be assumed to have made the good-faith certification of need in good faith. If the Small Business Administration determines that a business «lacked an adequate basis» for certifying the necessity of the PPP loan, the Small Business Administration will request business repay the outstanding PPP loan balance, and the business will become ineligible for PPP loan forgiveness.
What is the current status of the Paycheck Protection Program?
The PPP has been updated multiple times since its initial introduction in the CARES Act in March 2020.
April 24, 2020: The Paycheck Protection Program and Health Care Enhancement provided additional funding to the PPP
June 5, 2020: Paycheck Protection Program Flexibility (PPPF) Act H.R. into law which made substantial revisions to the PPP.
July 4, 2020: PPP application period extended from June 30, 2020, to August 8, 2020.
December 27, 2020: Consolidated Appropriations Act, 2021 extended and expanded the PPP until March 31, 2021. The CAA permits certain smaller businesses who received a PPP loan and experienced a 25% reduction in gross receipts to take a Second Draw PPP Loan of up to $2 million.
March 11, 2021: The American Rescue Plan Act (ARPA) increased funding to the PPP.
March 30, 2021: The PPP Extension Act of 2021 extended the PPP application deadline to May 31, 2021, and extended PPP authorization period through June 30, 2021.
In January 2021, when Congress revived PPP funds as part of a $2.3 trillion coronavirus relief package signed in December 2020, an additional $285 billion became available for PPP loans, of which approximately $25 billion was allocated to second-draw loans. When the first program expired in August 2020, Congress had approximately $130 billion left in unused funds. Borrowers were able to use the new 24-week period to restore their workforce to pre-COVID-19 levels in order to obtain full forgiveness.
What Is the Paycheck Protection Program Flexibility Act of 2020?
In other words, so long as the business uses its PPP funds for eligible expenses within 24 weeks of origination, or by Dec. 31, those funds are eligible for forgiveness. Also, SBA and the Department of Treasury Frequently Asked Question No. 40 provided a safe harbor from the reduction in loan forgiveness with respect to laid-off employees who reject a borrower’s offer of re-employment. The FAQ states that the borrower must have made a good faith, written offer of rehire, and the borrower must document the former employee’s rejection of the offer. The covered period is extended from June 30, 2020, to December 31, 2020.
PPP Issuance Period The CARES Act initially provided that PPP loans could be issued during a period running from February 15, 2020 to June 30, 2020. Today the President signed into law the “Paycheck Protection Program Flexibility Act of 2020” (H.R. 7010), which makes several substantial modifications to the U.S. Below is a summary of the key changes this bill makes to the Paycheck Protection Program (or “PPP”) loans. The language of the statute seems to indicate a “cliff,” but the SBA’s interim final rule from June 11 says that SBA will not apply the 60% test as a cliff.
Loans made to anti-vaccination organizations
Lastly, the bill eliminates a provision that makes a paycheck protection loan recipient who has such indebtedness forgiven ineligible to defer payroll tax payments. A new exemption to the reduction in loan forgiveness due to reduction in full-time equivalent employees is added. A reduction in the employee’s health insurance costs or retirement plan contributions do not cause any reduction in loan forgiveness.
Daily Financial Regulation Update — Friday, February 3, 2023 – Lexology
Daily Financial Regulation Update — Friday, February 3, 2023.
Posted: Fri, 03 Feb 2023 08:00:00 GMT [source]