Treasury Eases Terms for Small Businesses to Convert Loans to Grants

A fact sheet released on Friday said businesses could get forgiveness without rehiring all their employees if the layoffs occurred early on during the lockdowns.

The Treasury Department on Friday made it slightly easier for small-business owners to avoid having to repay government-backed loans they took out under a program designed to keep them from laying off employees and permanently closing.

Officials released a term sheet to guide borrowers on how to convert their Paycheck Protection Program loans into grants. The terms appeared to ease a requirement that businesses rehire a certain percentage of their employees in order to obtain forgiveness. But they did not do away with a requirement that many business found onerous: At least three-quarters of the money must be spent on payroll expenses and the rest on rent and utility bills.