PPP Changes Head to President

Written by Eric Beepat

On June 4, 2020

PPP Changes head to the President

Business owners who received a forgivable loan through the Paycheck Protection Program are finally getting more flexibility. The Senate passed H.R. 7010 Wednesday night that changed how business owners can use the loans. 

The following changes will occur:

  • Extending the minimum maturity of PPP loans that still have a remaining balance after the government forgives part of them to five years. This would take effect on the date of the bill’s enactment and apply to any PPP loan made on or after. The government would continue to guarantee the remainder of the loan.
  • Extending the PPP lifespan from June 30, 2020, to Dec. 31, 2020, for using loan proceeds.
  • Extending the period during which businesses may spend PPP loan funds from eight weeks after issuance to the earlier of 24 weeks after issuance or Dec. 31, 2020 (though eligible employers may elect to retain the eight-week covered period instead).
  • Specifying that PPP loans can be forgiven even if the number of full-time employees decreases, as long as the employer can prove: it attempted to rehire the same number of employees, but its former employees were unavailable; similarly qualified employees were unavailable; or its business is unable to return to the same level of activity it had before Feb. 15, 2020.
  • Lowers the amount that must be spent on payroll to be eligible for forgiveness from 75% to 60%.
  • Allowing all employers to take advantage of the CARES Act deferral of the 6.2% employer portion of Social Security payroll taxes, regardless of whether they have had a PPP loan forgiven.

Except as stated in the first item, all the changes would be effective retroactively, as if included in the CARES Act originally. Check here for additional information from the Small business Administration.  My previous blog post, details resources for the PPP loans.

The SBA has reported that 4.5 million businesses have received approval for loans totaling $510.6 billion. About $130 billion remain available for loans.


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