WASHINGTON—The Small Business Administration (SBA) has released an application for Paycheck Protection Program (PPP) loan forgiveness and instructions for borrowers. But the agency has not released additional guidance for lenders on the loan forgiveness process.
The SBA said the form and instructions include efforts to reduce compliance burdens and simplify the process for borrowers, including:
- Options for borrowers to calculate payroll costs using an "alternative payroll covered period" that aligns with borrowers' regular payroll cycles
- Flexibility to include eligible payroll and non-payroll expenses paid or incurred during the eight-week period after receiving their PPP loan
- Step-by-step instructions on how to perform the calculations required by the CARES Act to confirm eligibility for loan forgiveness
- Borrower-friendly implementation of statutory exemptions from loan forgiveness reduction based on rehiring by June 30
- Addition of a new exemption from the loan forgiveness reduction for borrowers who have made a good-faith, written offer to rehire workers that was declined
Two Interim Rules
NAFCU noted that in addition to the loan forgiveness application, the SBA last week issued two interim final rules related to the ability to increase certain PPP loans and the eligibility of certain electric cooperatives to apply for PPP loans. It also published updated FAQs to address questions related to the SBA's certification safe harbor and an extension to repay PPP loans until May 18.