PPP Flexibility Act Signed into Law

Published: June 5, 2020

On June 5, President Trump signed H.R. 7010, the Paycheck Protection Program Flexibility Act of 2020, into law. Under this law, new PPP loans have a term of five years rather than two. For all PPP loans, the covered period is 24 weeks or the end of the year, whichever comes first. Additionally, all borrowers are now able to defer payroll taxes on PPP loan proceeds and only required to spend 60 percent, instead of 75, of the PPP loan on payroll costs in order to qualify for loan forgiveness. This law does not make any changes to the affiliation rules that apply to the loan program.