What difference does that make? The Paycheck Protection Program Flexibility Act (PPPFA) of 2020


UPDATE 06/19/2020 with additional federal guidelines released 06/18/2020

On June 5, 2020, the Payroll Protection Program Flexibility Act of 2020 (PPPFA) came into effect.

All the Paycheck Protection Program (P3) rules and false starts combined with the 41 changes that followed gave me (and all the other advisors) a colossal headache. On June 5, 2020, Congress and the President gave us further and more definitive clarification on the Paycheck Protection Program Flexibility Act (PPPFA), which will undoubtedly go down in history as the deed. almost unanimous in the shortest duration in US history. (It passed 417-1 in the House and unanimously in the Senate.) As a business advisor, I was frustrated with the complexity and nuances of PPP, but pleased to see relief for owners of small enterprises. My friend and colleague, Bob Weins, JD, CPA of Insights3 Consultants from Michigan and I worked together to create the following chart to illustrate the old PPP rules and the changes made by the PPPFA. For comparison, note that the PPPFA aims to facilitate forgiveness and opens the possibility of total forgiveness for many companies. Companies will now have 24 weeks to restore the payroll and will be able to use 40% of the amount remitted for non-wage costs as defined in the original law. However, you have to be very careful taking into account the 60% used for payroll, it is a firm border, companies must use at least 60% of the total loan amount for payroll or no discount will be available. Here is our comparison:

There are some significant improvements in the PPPFA. However, the Treasury still cannot leave a good thing alone and we anticipate further changes. As Weins said, “Being a PPP expert, and now PPPFA is probably the shortest and most impactful level of expertise I’ve ever worked on. Nice to know that I can use this information until December 31st instead of June 30th. As always, I try to answer questions via email to [email protected], and I can send some to Bob as well. You might as well take the opportunity to read it all. Remember if you are a small business, self-employed, sole proprietor, or nonprofit, there is still P3 money left over and now it’s easier to get most or all of it. of the canceled loan.

Be careful.


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