24-week maximum: The longest covered period available is 24-weeks. Your covered period cannot extend beyond 24-weeks. Anywhere in between: You have the option to choose a covered period for any time frame between 8 and 24 weeks (e.g., 12 weeks, 20 weeks, etc.)

What does the 24-week PPP extension mean?

The Paycheck Protection Program Flexibility Act made some significant changes to PPP loans. Borrowers whose loan numbers were assigned after June 5 will automatically have a forgiveness period that is the shorter of: 24 weeks, or. From the date of the loan to December 31, 2020.

Will PPP terms be extended?

The Senate on Thursday overwhelmingly approved the PPP Extension Act of 2021. Lawmakers voted 92-7 to push back the Paycheck Protection Program (PPP) loan application deadline from March 31 deadline to May 31, extending the groundbreaking small business loan program an additional two months.

What is the 8 to 24 week period for PPP?

A borrower may select a covered period between 8 weeks and 24 weeks, which commences upon disbursement of the PPP loan proceeds. The flexibility on the part of a borrower to choose a particular covered period within that range was a feature added pursuant to the Economic Aid Act.

Do you have to wait 24 weeks to apply for PPP forgiveness?

Borrowers may submit a loan forgiveness application any time before the maturity date of the loan, which is either two or five years from loan origination.

How does the 24-week PPP work?

A borrower that uses a 24-week covered period reduced a full-time employee’s weekly salary from $1,000 per week during the reference period (i.e., the most recent full quarter during which the employee was employed before the covered period) to $700 per week during the covered period.

What is the new PPP deadline?

May 31, 2021
UPDATED: PPP Application Deadline Extended to May 31, 2021. UPDATED, APRIL 5, 2021: On March 30, 2021, President Biden signed the PPP Extension Act of 2021 into law extending the Paycheck Protection Program from March 31, 2021, to June 30, 2021.

Do I have to wait 24 weeks for PPP forgiveness?

Extended Coverage; Deadline for Forgiveness Application: The PPP2 Act and the rules specify that the “loan forgiveness covered period” is the period beginning on the ‎date the lender disburses the PPP loan and ending on any date selected by the borrower that occurs during the period (i) beginning on the date that is 8 …

When does the covered period start for PPP?

In order to address this valid business concern, the new covered period allows for PPP borrowers to elect a coverage period between 8-weeks and 24-weeks. The covered loan period itself starts on the date of the loan’s origination.

What is the PPP Extension Act of 2021?

The PPP Extension Act of 2021 (transcript) The portion of the bill that extends the application deadline reads as follows: To amend the Small Business Act and the CARES Act to extend the covered period for the paycheck protection program, and for other purposes.

When to extend forgiveness period for PPP loans?

Extending your forgiveness period from eight to 24 weeks could lead to the loan forgiveness process extending into next year. If you apply for other loans or lines of credit during that time, you may have a hard time qualifying while the PPP forgiveness issue is up in the air. Easier to meet staffing requirements.

Are there any changes to the PPP rule?

The PPP loan calculation formula is being revised to allow sole proprietors, independent contractors, and self-employed individuals to receive more financial support. The rule changes also allocate $1 billion in PPP funds for these types of businesses in low-and moderate-income (LMI) areas.