New/Revised PPP Loan Forgiveness Applications and More
CARES Act provisions are still being clarified and expanded and we expect more to come. Here's the latest on the PPP loan program.
New and revised applications. The SBA recently released a revised PPP Loan Forgiveness Application and a new EZ Loan Forgiveness Application for borrowers. The revised form includes the changes from the Paycheck Protection Program Flexibility Act of 2020 that was signed into law on June 5th. The new EZ form has fewer calculation requirements and less documentation. The EZ form only applies to 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%.
Click HERE for the revised PPP Loan Forgiveness Application and HERE for the instructions.
Click HERE for the new PPP EZ Loan Forgiveness Application and HERE for the instructions.
SBA also just released a new Interim Final Rule (IFR) that provides revisions to the prior loan forgiveness IFR and includes loan review procedures. HERE is the new IFR. Noted in the recent IFR, "As a general matter, the lender will review the application and make a decision regarding loan forgiveness." We encourage PPP loan recipients to talk with their lender to gain expectations and clarity on loan forgiveness procedures. Each bank may have varying requirements, including how they will accept the applications, format, timing, records, and specific calculators to use to analyze expenditures.
In addition, make sure to work with your accounting professional help ensure your calculations are correct per the PPP use guidelines, to help define your “coverage period," help ensure other compliance is met for full forgiveness, and to take advantage of other tax and relief efforts.
PPP loan recipients will be disclosed to the public. The SBA and Treasury announced they will be disclosing certain information on PPP loan recipients for taxpayer transparency.
SBA will disclose the business names, addresses, NAICS codes, zip codes, business type, demographic data, non-profit information, jobs supported, and loan amount ranges as follows:
- $350,000-1 million
- $1-2 million
- $2-5 million
- $5-10 million
For loans below $150,000, totals will be released, aggregated by zip code, by industry, by business type, and by various demographic categories.