On January 19, 2021, the U.S. Small Business Administration (SBA) and Treasury published updated Paycheck Protection Program (PPP) loan forgiveness guidance and forms. The newly released forms include:
- PPP Loan Forgiveness Application Form 3508S – one-page application for borrowers that received a PPP loan of $150,000 or less
- Form 3508EZ – streamlined application for eligible borrowers, which requires fewer calculations than Form 3508
- PPP Loan Forgiveness Application Form 3508 – application for borrowers that do not qualify to submit Forms 3508S or 3508EZ
- Form 3508D – two-page document to be submitted by certain individuals required to disclose controlling interest in an entity applying for a PPP loans
As provided by the recently enacted Consolidated Appropriations Act, 2021 (CAA), the new Form 3508S offers a simplified forgiveness application process for smaller borrowers. These borrowers must provide loan amount, disbursement date, employee totals, covered period dates, amount of the loan spent on payroll, and the amount of the loan for which forgiveness is being sought. No supporting documentation is required to be submitted with the application. However, all borrowers are advised to maintain records of payroll and nonpayroll costs as well as other documents that could be requested during an SBA loan review or audit.
Borrowers using Forms 3508 and 3508EZ must submit payroll and nonpayroll documentation when applying for loan forgiveness. The instructions included with these forms provide lists of the required documents.
The Form 3508D was created to fulfill the new requirement included under the Economic Aid Act (as part of the CAA), which mandates borrowers that received First Draw PPP Loans before December 27, 2020, to disclose whether a Covered Individual directly or indirectly held a Controlling Interest in the Borrower at the time the Borrower’s loan application was submitted to the PPP lender.
If the borrower submitted a loan forgiveness application to its PPP lender before December 27, 2020, then Form 3508D must be completed and submitted to the PPP Lender not later than January 26, 2021. If the borrower submits a loan forgiveness application to its PPP lender on or after December 27, 2020, Form 3508D must be completed and submitted to the PPP Lender within 30 days after submitting the forgiveness application.
If you need assistance or have questions about PPP loan forgiveness, please contact Bob Grossman, Don Johnston or Mike Weber at 412-338-9300.
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