New
Streamlined PPP Loan Forgiveness Application
The SBA has approved a simplified
one-page PPP loan forgiveness application for loans of $50,000 or less. The new
streamlined form makes the application process much easier for borrowers who
obtained less than $50,000. The new form 3508S does not require calculations or
reporting of employee hours and salaries. Rather, borrowers can self-certify
their loan forgiveness amount. Additionally, eligible borrowers who complete
form 3508S are exempt from any decrease in the forgiveness amount based on
reductions in full-time employees or employee salary/wages.
While including the calculations on form 3508S is not required, borrowers will still need to compute the amount eligible for forgiveness. Documentation verifying payroll and non-payroll costs is required and the SBA may, at their discretion, request to see the additional calculations. View Form 3508S
SBA
Clarifies PPP Deferral Period
The SBA has updated their FAQs
with Question 52 regarding the deferral period. The PPP Flexibility Act that
went into effect on June 5, 2020 extended the deferral period for borrower
payments of principal, interest, and fees on all PPP loans to the date that SBA
remits the borrower's loan forgiveness amount to the lender (or, if the
borrower does not apply for loan forgiveness, 10 months after the end of the
borrower's loan forgiveness covered period). Previously, the deferral period
could end after 6 months. This raises the question of whether lenders and
borrowers are required to modify promissory notes used for PPP loans to reflect
the extended deferral period.
The SBA has clarified that
extension of the deferral period under the Flexibility Act automatically
applies to all PPP loans. Lenders are required to give immediate effect to the
statutory extension and should notify borrowers of the change to the deferral
period. SBA does not require a formal modification to the promissory
note. View FAQs