The payroll expenditure requirement drops to 60% from 75%. \;To receive full loan forgiveness\, a borrower must use at least 60 percent of the PPP loan for payroll costs\, and not more than 40 percent of the loan forgiveness amount may be attributable to nonpayroll costs. If borrower utilizes less\, the amount of loan forgiveness will be partially forgiven to the percentage they used for payroll costs. \;Borrowers can use the 24-week period to restore their workforce levels and wages to the pre-pandemic levels required for full forgiveness. This must be done by Dec. 31\, a change from the previous deadline of June 30.
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The U.S. Senate passed the House version of Paycheck Protection Program (PPP) legislation\, tripling the time allotted for small businesses and other PPP loan recipients to spend the funds and still qualify for forgiveness of the loans.
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\n19\,000 North Dakota businesses received the PPP loan and more details on the loan forgiveness will be released on this \;Business Briefing scheduled for June 18th at 9 a.m. \; \;
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Following is a summary of the legislation&rsquo\;s main points compiled by the AICPA: \;
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\n - PPP borrowers can choose to extend the eight-week period to 24 weeks\, or they can keep the original eight-week period. This flexibility is designed to make it easier for more borrowers to reach full\, or almost full\, forgiveness.
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\n - The payroll expenditure requirement drops to 60% from 75%. \;To receive full loan forgiveness\, a borrower must use at least 60 percent of the PPP loan for payroll costs\, and not more than 40 percent of the loan forgiveness amount may be attributable to nonpayroll costs. If borrower utilizes less\, the amount of loan forgiveness will be partially forgiven to the percentage they used for payroll costs. \;Borrowers can use the 24-week period to restore their workforce levels and wages to the pre-pandemic levels required for full forgiveness. This must be done by Dec. 31\, a change from the previous deadline of June 30.
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\n - The legislation includes two new exceptions allowing borrowers to achieve full PPP loan forgiveness even if they don&rsquo\;t fully restore their workforce. Previous guidance already allowed borrowers to exclude from those calculations employees who turned down good-faith offers to be rehired at the same hours and wages as before the pandemic. The new bill allows borrowers to adjust because they could not find qualified employees or were unable to restore business operations to Feb. 15\, 2020\, levels due to COVID-19 related operating restrictions.
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\n - Borrowers now have five years to repay the loan instead of two.
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\n - The interest rate remains at 1%.
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June 18 \;| 9:00 Call: \;*Special* Business Briefing - \;Paycheck Protection Program Flexibility Act
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AGENDA-TBA
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To receive call-in information\, attendees must register as a non-member. \;A confirmation email with call specifics will be sent to the email provided in upon completion of registration and prior to the call. Please \;provide your questions relating to the call during \;registration. These will be provided ahead of time to the Department of Commerce so that \;presenters can address your questions to the extent possible\, given the dynamic environment. \;Questions not addressed during the conference call will be answered in follow-up communication.
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