The PPP provided 5.2 million loans worth $525 billion to small businesses in an attempt to lessen the hardship suffered from the coronavirus pandemic. Originally, the majority of the PPP loans had to be used to towards paying employees. However, a lot of these small businesses didn’t have any employees, or their only employee was the sole owner of the business.
Form 3508S: Form The SBA released a new, two-page forgiveness application that has removed the calculations found on previous forms. Borrowers must still submit documentation regarding payroll and non-payroll expenses to their lenders. They should retain all supporting documentation for six years.
The simpler application allows for lenders to expedite the processing of forgiveness applications. Lenders will need to confirm receiving the appropriate documentation, but correct calculations of eligible costs are the responsibility of the borrowers.
Who can’t use the simplified application
- Small businesses who have reduced their full-time headcount or reduced their pay rates by more than 25% from pre-coronavirus levels.
- Businesses who borrowed more than $50,000.
If you have questions regarding the application forgiveness process, please contact your AHP professional.