Today, the White House signed into law the Paycheck Protection Program Flexibility Act (PPPFA), which allows for added flexibility to Paycheck Protection Program (PPP) resources for businesses recovering from the COVID-19 pandemic.

The new law allows for the following changes:

1. Changes the minimum amount of the loan that is dedicated to payroll from 75% to 60%, which frees up to an additional 40% of the loan for other qualifying expenses.

2. Expands the time period to use funds from the date they are received from 8 weeks to 24 weeks.

3. Pushes the date to rehire workers from June 30, 2020 to December 31, 2020.

4. Eases rehire requirements by adding additional exceptions for a reduced rehired workforce. The law states a business can still receive forgiveness on payroll amounts if it:

A. Is unable to rehire an individual who was an employee of the eligible recipient on or before February 15, 2020;

B. Is able to demonstrate an inability to hire similarly qualified employees on or before December 31, 2020; or

C. Is able to demonstrate an inability to return to the same level of business activity as such business was operating at prior to February 15, 2020.

5. Extends the repayment term from 2 years to 5 years, at 1% interest. It also allows the first payment to be deferred for up to 6 months.

6. Permits the deferment of payroll taxes for Social Security.

For more information from the U.S. Department of the Treasury, visit https://home.treasury.gov/.