The SBA has released its Loan Forgiveness Application and Instructions for Borrowers, which provides the application and instructions for borrowers to calculate and submit their request to have all or a portion of their PPP loan forgiven.
A few particular items of note in the application and instructions:
- Borrowers are required to indicated whether the borrower, along with its affiliates (to the extent required under the SBA’s interim final rule on affiliates and not waived), received PPP loans with an original principal amount in excess of $2 million.
- Borrowers may, for most purposes, elect to use an eight-week period beginning on the date their PPP loan was disbursed OR an eight week-period beginning on the first day of the first pay period following the date their PPP loan was disbursed.
- Payroll costs incurred but not paid during the last pay period of the eight-week period are eligible for forgiveness if paid on or before the next regular payroll date.
- The loan forgiveness application contains a number of certifications, including that the information in the application and all supporting documents and forms is true and correct in all material respects and that the tax documents submitted to the lender are consistent with those that are or will be submitted to the IRS and/or state tax or workforce agency.
The SBA also notes that forgiveness may be disapproved if the SBA determines that the borrower was ineligible for a PPP loan.
The loan forgiveness application also provides information with respect to the documentation that needs to be submitted to the borrower’s lender in connection with the loan forgiveness application and the documentation to be retained by the borrower.
We will be updating or supplementing our prior client release, "So You Were Approved for a Paycheck Protection Program Loan—Now What?" to reflect the Loan Forgiveness Application and instructions.
Borrowers should also note that the loan forgiveness application and instructions is not a regulation, and may be subject to change.
