SBA Releases PPP Loan Forgiveness Application
May 18, 2020
The Small Business Administration (SBA), in consultation with the US Department of the Treasury, released the Paycheck Protection Program (PPP) loan forgiveness application and detailed instructions for completing the application.
The PPP was created by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to provide forgivable loans to eligible small businesses to keep workers on the payroll during the COVID-19 pandemic. The application allows small businesses to seek forgiveness of their PPP loans at the conclusion of the eight-week covered period, which began with the disbursement of the funds.
The form and instructions include several measures to reduce compliance burdens and simplify the process for borrowers, including:
· Options for borrowers to calculate payroll costs using an "alternative payroll covered period" that aligns with borrowers' regular payroll cycles
· Flexibility to include eligible payroll and non-payroll expenses paid or incurred during the eight-week period after receiving their PPP loan
· Step-by-step instructions on how to perform the calculations required by the CARES Act to confirm eligibility for loan forgiveness
· Borrower-friendly implementation of statutory exemptions from loan forgiveness reduction based on rehiring by June 30
· Addition of a new exemption from the loan forgiveness reduction for borrowers who have made a good-faith, written offer to rehire workers that was declined
To view the application and instructions, visit the SBA website.