PPP continues to evolve, new rules issued Email
Written by ALCC   
Tuesday, May 12, 2020 12:00 AM

The Paycheck Protection Program (PPP) seemed to be a welcome relief for employers affected by the pandemic. But as the program has evolved, and high-profile recipients have drawn scrutiny, the program may not be as attractive for some small businesses. 

News of a little-used whistleblower law coming into play may have made some companies hesitant to apply. As eligibility for PPP funds is questioned and audits of recipients have been promised, companies that are unsure of their eligibility under changing guidelines may fear that employees could invite scrutiny. The False Claims Act (FCA), also known as the Lincoln Law, allows employees or whistleblowers to sue the company and receive a portion of the fraudulent claim as a reward. 

The IRS issued a notice on April 30 stating that forgiven PPP loans would mean that companies could not take tax deductions for salaries, rent, and other payments made with PPP funds.

The rules around PPP loan forgiveness seem to be changing regularly, making many employers unsure. ALCC recommends that employers maintain a close relationship with their lender and continue to monitor their eligibility for PPP amid changes to the rules.