Congress Extends PPP Spend Period
Congress just passed changes to the PPP program, now headed for presidential approval:
- Extends the eight-week spending period of PPP funds for an additional 16 weeks
- Increases the repayment time for unforgiven funds to five years for most applicants
- Changes the forgiveness requirement maximum for non-payroll expenses from 25% to 40%, with a severe penalty if the 40% is exceeded
- Permits full forgiveness where the employer shows it is unable to reinstate or replace furloughed or former employees, under specified circumstances
- Extends FICA Tax deferment to PPP borrowers
A number of points remain subject to SBA interpretation/guidance, which we expect soon after the bill becomes law.
The PPP program has grown increasingly complex since its inception, and the possibilities of errors and missing out on substantial reimbursement is not zero. The application for forgiveness requires a sworn certification under penalty of perjury and all recipients are subject to audit by the U.S.Treasury. Retaining the assistance of a qualified professional is highly prudent to validate expenditures and complete the forgiveness application.
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