5-19-20 PPP Loan- Forgiveness Application
Posted on May 19, 2020
On Friday, May 15th, 2020, the Small Business Administration (the "SBA"), in consultation with the Department of the Treasury, released the Loan Forgiveness Application for the Paycheck Protection Program (the "PPP"), along with instructions for the application.
The application form and instructions inform borrowers how to seek forgiveness of their PPP loans at the conclusion of the eight week covered period, which begins with the disbursement of their loans, consistent with the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
According to the SBA, the form and instructions include several measures intended to reduce compliance burdens and simplify the forgiveness process, including:
- Payroll aligns with borrowers’ regular payroll cycles
- Option to include eligible payroll and non-payroll expenses paid or incurred during the eight-week period after receiving their PPP loan
- Instructions on how to perform the calculations required by the CARES Act to confirm loan forgiveness eligibility
- Implementation of statutory exemptions from loan forgiveness reduction based on rehiring by June 30
- Addition of an exemption from the loan forgiveness reduction for borrowers who have made a written rehire offer that was declined
The SBA also announced on Friday that it will also issue further guidance to assist borrowers with the completion of their applications and provide guidance for lenders. We will issue an updated alert upon the release of further guidance from the SBA.
Please contact your Woods Oviatt attorney or the attorneys listed in our COVID directory regarding this or any COVID-19 related issues.