This is Vernon Litigation Group’s weekly bulletin to support local small business owners and help navigate the challenges of staying in business, supporting employees and clients, supporting the community, and positioning the business for growth and success on the other side of the COVID-19 crisis.
The Paycheck Protection Program Flexibility Act was signed into law on June 5, 2020, in an effort to provide more flexibility to small business owners regarding the Paycheck Protection Program (which is aimed at delivering COVID-19 relief). The Paycheck Protection Program Flexibility Act will ease some of the demands placed on small businesses that received Paycheck Protection Program loans, and for small business owners that may still apply.
The new law extends the period that small business recipients have to spend the loan funds from 8 weeks to 24 weeks (from the date funds were received). It also gives business owners more time to rehire laid-off and furloughed employees, so that staffing numbers meet the requirements for loan forgiveness. As another benefit, the Paycheck Protection Program Flexibility Act reduces the percentage of a forgivable loan that must be put toward payroll from 75% to 60%, thus increasing the amount of funds available for other expenses from 25% to 40% (including expenses for rent, utilities, and mortgage payments). Also, small business borrowers who do not have their entire loan forgiven now have 5 years to repay, instead of 2 years.
Moving forward, the Paycheck Protection Program Flexibility Act appears to be a win for small businesses, as the changes in this new bill will allow more to benefit from this small business relief effort.
If you have any questions or require further assistance to help you navigate through these difficult times, please feel free to give us a call. We are all in this together.
Vernon Litigation Group represents businesses & individuals throughout the United States who have financial disputes, including cyber litigation, securities litigation & arbitration, business & commercial litigation, financial advisors & employment disputes, and FINRA arbitration.
For more information contact, Brooke Sandoval-Banker bsandovalbanker@vernonlitigation.com or call (239) 319-4434.