The SBA along with the U.S. Treasury Department issued a new, streamlined loan forgiveness application for businesses with Paycheck Protection Program loans of $50,000 or less. The guidance, as outlined in a new final interim rule, further simplifies the loan forgiveness process.
The SBA is at the same time releasing a new simplified Form 3508S to be used by borrowers with loans of $50,000 or less, except for borrowers that together with affiliates received loans totaling $2 million or greater.
In addition to requiring fewer calculations and less documentation for eligible borrowers, the new Form 3508S does not require borrowers with loans of $50,000 or less to reduce their loan forgiveness calculations if they have cut head count or salaries.
The new application does not require borrowers to show the math on how they calculated their loan forgiveness amount. However, the SBA says it reserves the right to request documentation to back up those numbers at a later date.
Why $50,000 or less? According to the SBA, there are approximately 3.57 million outstanding PPP loans of $50,000 or less, totaling approximately $62 billion of the $525 billion in PPP loans. In addition, approximately 1.71 million PPP loans of $50,000 or less were made to businesses that reported having zero employees or one employee
The Porte Brown PPP team will continue to monitor the news and update you as more information becomes available.
