Treasury and SBA Announce Simpler PPP Loan Forgiveness Form
October 9, 2020 – The Treasury Department and the Small Business Administration (SBA) have issued a joint press release and Interim Final Rule announcing a “simpler” version of the form used by recipients of Paycheck Protection Program (PPP) business loans of $50,000 or less to request loan forgiveness.
The PPP is an SBA lending program created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act to help small employers meet payroll and other expenses as businesses and the nation have been dealing with the economic effects of the coronavirus (COVID-19) pandemic.
Importantly, if certain conditions are met, PPP loans can be forgiven and treated as a grant. Payroll expenses can include employer contributions to defined contribution and defined benefit retirement plans, as well as providing group health care coverage, including payment of insurance premiums.
The “simpler” PPP Loan Forgiveness Application Form 3508S and its instructions is intended for borrowers who received a PPP loan of $50,000 or less and did not, together with its affiliates, receive PPP loans totaling $2 million or greater. The standard Loan Forgiveness Application Form 3508 and EZ Loan Forgiveness Application Form 3508 EZ remain available for borrowers to use when applicable.
All of the loan forgiveness application forms are set to expire October 31, 2020.