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News June 17, 2020

SBA provides EZ version of loan forgiveness application

The Department of the Treasury and Small Business Administration released updated loan forgiveness applications for the Paycheck Protection Program based on changes made by the Paycheck Protection Program Flexibility Act (H.R. 7010) enacted into law June 5. View the primary revised PPP forgiveness application for borrowers.

In addition, the SBA is providing a new EZ version of the revised forgiveness application that may be used by borrowers who meet one of the following criteria:

  • Are self-employed and have no employees
  • Did not reduce the salaries or wages of their employees by more than 25% and did not reduce the number or hours of their employees
  • Experienced reductions in business activity as a result of health directives related to COVID-19 and did not reduce the salaries or wages of their employees by more than 25%

This new EZ application requires fewer calculations and less documentation for eligible borrowers. The newly revised applications give borrowers whose loans were made before June 5 the option of using the original eight-week covered period or the extended 24-week covered period provided for by H.R. 7010.

A new Interim Final Rule also was released that includes further guidance related to changes made by the Paycheck Protection Program Flexibility Act. This new Interim Final Rule updates the Interim Final Rule on Additional Eligibility Criteria and Requirements for Certain Pledges of Loans, specifically limiting forgiveness of owner compensation replacement for individuals with self-employment income who file a Schedule C or F to either eight weeks’ worth (8/52) of 2019 net profit (up to $15,385) for an eight-week covered period or two-and-a-half months’ worth (2.5/12) of 2019 net profit (up to $20,833) for a 24-week covered period per owner in total across all businesses. It also updates the Interim Final Rule on Disbursements to allow borrowers whose loan was made before June 5 to keep the original covered period at eight weeks or choose a 24-week covered period as allowed by H.R. 7010.

If you are interested in applying for a PPP loan, please speak with your lender and/or visit the Treasury Department’s website to learn more.

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