SBA Issues Revised PPP Loan Forgiveness Application
It also released an EZ application, requiring fewer calculations and less documentation, for eligible borrowers.
The Small Business Administration posted Wednesday morning a revised Paycheck Protection Program loan forgiveness application implementing the PPP Flexibility Act of 2020, which was signed into law by President Donald Trump on June 5.
The SBA, in consultation with Treasury, also published a new EZ version of the forgiveness application for borrowers that:
- Are self-employed and have no employees; or
- Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; or
- Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.
The EZ application requires fewer calculations and less documentation for eligible borrowers. Details on the applicability of these provisions are available in the instructions to the application form.
“Both applications give borrowers the option of using the original 8-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period,” SBA explained. “These changes will result in a more efficient process and make it easier for businesses to realize full forgiveness of their PPP loan.”
The House Committee on Small Business plans to hold a hearing Wednesday afternoon titled “Paycheck Protection Program: Loan Forgiveness and Other Challenges.”
Veena Murthy, a principal at Crowe LLP in Washington, told ThinkAdvisor in a previous interview that guidance was needed to clarify that existing borrowers can keep the June 30 end date for the rehire safe harbor, rather than the law’s change to Dec. 31. “There are many borrowers who want to keep the 8-week period and it’s critical for them to keep the June 30 rehire date,” she said.
— Related on ThinkAdvisor: