The SBA and Treasury have issued the new and revised Borrower Application for applying for a loan under the Paycheck Protection Loan Program (PPP). The due date to apply for a PPP loan is June 30, 2020. Currently there is approximately $130 billion still remaining and available to distribute.
The new application implements the new guidance for the PPP issued under the Paycheck Protection Program Flexibility Act (PPPFA), which the president signed on June 5. The PPPFA has created more flexibility for borrowers, with a longer covered period ( from eight weeks to 24 weeks) and more flexibility in the types of expenses that can qualify for loan forgiveness.
The new Act allows 40% of the proceeds to be used for non-payroll qualified expenses, such as rent and utilities, up from 25% under the CARES act, which was signed on March 27, 2020. In addition, the Act lengthens the term of the portion of the loan not forgiven to five years and defers loan payments up to December 31, 2020. The SBA has also issued revised guidance expanding PPP eligibility for business owners who have past felony convictions. It is expected that SBA and Treasury will issue additional guidance on this application, as well as a revised application for forgiveness of qualifying loan proceeds in the near future.
We will continue to keep you updated. Should you have any questions, please don’t hesitate to reach out to your tonneson + co representative.