The Senate has passed legislation that would give recipients of the Paycheck Protection Program more flexibility in how the funds can be used, reports CNBC. The passage in the Senate comes after the House approved the legislation last week. Now the new bill is just waiting on President Trump to sign it so the changes can go into effect.
As we reported last week, the changes would relax some restrictions on what business can do with PPP loans, including:
- Allowing only 60% of the loan funds to be spent on payroll. Right now 75% is required to be spent on payroll.
- The loan forgiveness period would be extended from 8 to 24 weeks.
- The deadline to rehire workers would be pushed back from its current June 30 date.
- Businesses that have the PPP loan forgiven could now defer payroll taxes.
The Paycheck Protection Program was originally passed as part of the larger $2 trillion CARES Act back in March. However, the rollout of the act has been criticized for being poorly executed as well as certain provisions in it too restrictive. The latest legislation to alter the PPP portion of the act is an attempt to fix some of those complaints.
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