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May 26, 2020 at 09:58 PM
The Small Business Administration released Friday an interim final rule that applies to loan forgiveness applications submitted under the Paycheck Protection Program.
Leon LaBrecque, chief growth officer at Sequoia Financial Group in Troy, Michigan, told ThinkAdvisor on Tuesday that advisors “including CPAs are frustrated with the ever-changing landscape of rules and regulations surrounding the PPP.”
Said LaBrecque: “We start with one version of guidance, which is then changed in subsequent rules, and then changed in an application, which is changed by another set of rules. It’s very tough to comply when the rules change continuously, usually on Friday night.”
LaBrecque heads a task force for the Michigan Association of CPAs on how to apply for PPP and how the program affects nonprofits.
One area of frustration is that the interim final rule “doesn’t line up” with the instructions in the PPP loan forgiveness application, which was released May 18, LaBrecque said. The SBA is “now using paid or incurred vs. paid and incurred for both payroll costs and non-payroll costs. The example they use looks like you could only get one month of additional costs (May paid in June).”
The guidance also includes an “expansive definition” of payroll costs, LaBrecque said.
Also explained is that the “bank has 60 days from the date of application to approve request for forgiveness,” while “SBA has 90 days after that date to review the loan or loan application and render payment,” LaBrecque said.
