On May 15, 2020, the Small Business Administration (SBA) released their application that businesses will submit to their lender to apply to have their Paycheck Protection Program (PPP) loans forgiven. The application, which is accompanied by a number of worksheets and instructional pages, provides clarity on a number of critical questions that were facing PPP loan recipients.
There are still some open questions and we anticipate that, in addition to the application document, the SBA will be releasing interim rules relating to the loan forgiveness provisions. In the meantime, businesses that received a PPP loan, are well advised to review the application and accompanying guidance as soon as possible, rather than waiting until the end of their loan period, in order to identify and take any necessary steps to ensure and maximize loan forgiveness. The biggest new takeaways from the application are: the covered loan period, calculation of forgivable expenses, and reductions to forgiveness.
Please view the Small Business Legislative Council’s memo on these provisions.