5-week PPP Loan Extension
By Jeff Drew
President Donald Trump signed a bill Saturday re-opening the application window for the Paycheck Protection Program (PPP) until Aug. 8.
The five-week extension had been approved last week by both chambers of Congress. The U.S. House of Representatives and the Senate both passed the legislation by unanimous consent.
The PPP in brief
Congress created the PPP as part of the $2 trillion Corona virus Aid, Relief, and Economic Security (CARES) Act, P.L. 116-136. The legislation authorized Treasury to use the SBA’s small business lending program to fund forgivable loans of up to $10 million per borrower that qualifying businesses could spend to cover payroll, mortgage interest, rent, and utilities.
The loans are available to small businesses that were in operation on Feb. 15 with 500 or fewer employees, including not-for-profits, veterans’ organizations, Tribal concerns, self-employed individuals, sole proprietorship, and independent contractors. Businesses with more than 500 employees in certain industries also can apply for loans.
The amount of the loan forgiveness may be reduced based on the percentage of eligible costs attributed to non-payroll costs, any decrease in employee headcount, and decreases in salaries or wages per employee.