The SBA says it's loosening payroll restrictions to allow PPP partial loan forgiveness - Business Insider

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The Small Business Administration says it's loosening payroll restrictions to allow partial loan forgiveness under PPP small business aid program

governing the Paycheck Protection Program to allow small businesses to qualify for partial loan forgiveness even if 60% of the government-financed loan wasn't directed toward loan forgiveness.

The SBA issued the new rule in the early hours of Thursday morning. It's set to make partial loan forgiveness available to vastly more small businesses that don't spend the majority of their cash on workers' paychecks.

PPP was implemented back in March under the CARES Act as Congress rushed to stave off an economic disaster and massive layoffs of workers. The $660 billion federal program was designed to allow small businesses to qualify for loans that could be fully forgiven if a substantial chunk of the loan went toward employing workers.

But many businesses criticized the restrictions as onerous and faulted rule changes that triggered confusion. Other critics blasted the program when large publicly traded companies were found to be drawing funds from it.

 

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