Over the weekend, the Small Business Administration (SBA) and Department of Treasury provided the next major step for the Paycheck Protection Program, releasing the PPP Loan Forgiveness Application along with detailed instructions. Borrowers may request forgiveness of PPP loans by completing SBA Form 3508, linked below, and submitting to their lender. Here are some important highlights:
- The application includes a Loan Forgiveness Calculation Form and Schedule A Worksheet to help borrowers determine their payroll costs and the amount eligible for forgiveness
- Costs eligible for forgiveness are: 1) Payroll costs; 2) Business mortgage interest payments; 3) Business rent or lease payments; and 4) Business utility payments
- Borrowers receiving loans of over $2 million will need to note this amount on the form, and these loans may be audited by the Treasury
- The SBA requires that 75% or more of the amount forgiven be attributable to payroll costs
- Again, the completed form must be submitted to your lender. Some lenders may make the application available electronically; check with your lender if you would prefer this option.
The release of this application is a critical and much-anticipated development.
For more information, visit the SBA website.