The Department of the Treasury and the Small Business Administration (SBA) released a new application and instructions for Paycheck Protection Program (PPP) loan forgiveness on Friday, May 15. The form and instructions aim to streamline the process and reduce the compliance burden for borrower forgiveness at the end of the eight-week covered period, which begins with the disbursement of the loan.
Even with the publication of this document, we expect to receive additional guidance and will share it once it becomes available.
Read the full text of Friday’s press release here.
Highlights of the Paycheck Protection Program Loan Forgiveness Application include:
- 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