News Regarding SBA PPP Loan Forgiveness Application ProcessMay 19, 2020
SBA and Treasury Release Paycheck Protection Program Loan Forgiveness Application
Federal contractors who have received PPP funds from the SBA will be pleased to know that a PPP Loan Forgiveness Application has been made available. According to the SBA’s May 15th press release:
The form and instructions inform borrowers how to apply for forgiveness of their PPP loans, consistent with the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). SBA will also soon issue regulations and guidance to further assist borrowers as they complete their applications, and to provide lenders with guidance on their responsibilities.
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
Please read the entire SBA press release at www.sba.gov by navigating to the SBA Newsroom under the “About Us” tab. The press release includes a link to the PPP Loan Forgiveness Application. The application can also be accessed directly at https://bit.ly/3g9BsAO. We recommend that you work closely with your lender in applying for forgiveness for your SBA PPP Loan.
As the application instructions state, “To apply for forgiveness of your Paycheck Protection Program (PPP) loan, you (the Borrower) must complete this application as directed in these instructions, and submit it to your Lender (or the Lender that is servicing your loan). Borrowers may also complete this application electronically through their Lender.”
The forgiveness includes both eligible payroll costs and eligible non-payroll costs, which are explained in detail within the application. PPP Loan recipients who also received an Economic Injury Disaster Loan (EIDL), in addition to the PPP Loan, should be aware that the application includes forgiveness of the EIDL amount.
Kline and Company staff are available to address any tax related questions, or issues related to PPP. Please call us at 603-881-8185 or email us at firstname.lastname@example.org