Last Friday, May 15, the Small Business Administration and Treasury Department released the application that borrowers must complete in order to have their Paycheck Protection Program loan forgiven. The form includes detailed information about the costs that are eligible for forgiveness and how to calculate those costs.
To apply for forgiveness of your Paycheck Protection Program (PPP) loan, you must complete the application and submit it to your lender (or the lender that is servicing your loan). Borrowers may also complete this application electronically through their lender.
According to the Treasury Department’s press release, the application 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
You can access the loan forgiveness application here.
Small businesses with questions about PPP loan forgiveness should talk to their lender and also review the FAQs on the SBA website.
To read the Treasury Department press release, please click here.
For more information on the CARES Act and how the Treasury Department has expanded the allowable use of funds to several areas of importance to the business community, please see this document from the U.S. Chamber of Commerce.