As we near the end of the third quarter, businesses that received loans from the Small Business Administration (SBA) for the Paycheck Protection Program (PPP) have reached or are nearing the end of the 24-week, extended covered period.
Over the previous 24 weeks, businesses have been encouraged to expense the amount of their loans on payroll and related costs, as well as mortgage interest, rent, and utilities, as a part of the CARES Act stimulus program.
Lenders will have 60 days to review forgiveness applications and submit them to the SBA. In turn, the SBA has another 90 days to review the applications before determining whether an applicant qualifies for full or partial forgiveness.
Payroll service providers and lenders are leveraging technology to improve the collection and submission process through PPP-specific reports and portal applications. However, achieving forgiveness remains much more cumbersome than the application process — and than most may have anticipated.
To achieve full forgiveness, applicants will need to demonstrate acceptable expenditures were made, and, in many cases, may need to meet allowable safe harbors or overcome penalties incurred.
In particular, all borrowers must attest to the accuracy and completeness of forgiveness applications, and the list of supporting documentation forms required can be extensive.
For borrowers whose loans were $2M or greater, the application process will likely receive additional scrutiny from banks and the SBA, as was previously stated by the Treasury Department.
HORNE is working with borrowers and lenders to assist with the forgiveness application and submission process.
If you have questions about the PPP loan forgiveness process, HORNE is here to help. Click the button below to sign up for HORNE’s Forgiveness Assistance Program or contact us at PPPForgiveness@hornellp.com.
For all the latest resources and insights to help your business navigate the changes caused by the coronavirus pandemic, check out our COVID-19 Resource Hub.