Paycheck Protection Program Loan Forgiveness Application Released

*Also read our most recent update: SBA Releases Guidance Regarding SBA Loan Review Procedures and Responsibilities of Borrowers and Lenders

On May 15, 2020, the Small Business Administration (“SBA”) and Treasury Department released a new Paycheck Protection Program (PPP) Loan Forgiveness Application.  The application and detailed instructions and worksheet detail how borrower and lenders will document forgiveness of a PPP loan. The SBA will issue additional regulations and guidance to assist borrowers in completing the application and to provide lenders with guidance on their responsibilities.

Key highlights include:

  • Borrowers have an option 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 8-week covered period after receiving a PPP loan.
  • Specific instructions on the calculation required to achieve loan forgiveness.
  • Implements the statutory exemption from loan forgiveness reduction based on rehiring by June 30th.
  • Confirms a new exemption from loan forgiveness reductions for borrowers who have made a good-faith, written offer to rehire workers that was declined.
  • Confirms a per employee compensation cap of $15,385 during the 8-week period.
  • Requires borrowers and affiliates, if any, to confirm receipt of original loan proceeds in excess of $2.0m.
  • Identifies the documentation required to be submitted with the application.
  • Includes 7 additional certifications required to be made by borrowers.

Please reach out to us for the latest guidance, and see the PPP Loan Forgiveness Application and Instructions.

A printable version of this information can be found by clicking HERE.

 

Authors: Mark Brasee & Neil Hassler

Mark L. Brasee

Mark L. Brasee

Partner

(402) 978-5306
mbrasee@fraserstryker.com

Neil P. Hassler

Neil P. Hassler

Associate

(402) 978-5374
nhassler@fraserstryker.com

This article has been prepared for general information purposes and (1) does not create or constitute an attorney-client relationship, (2) is not intended as a solicitation, (3) is not intended to convey or constitute legal advice, and (4) is not a substitute for obtaining legal advice from a qualified attorney. Always seek professional counsel prior to taking action.