SBA Released Streamlined Application for Some PPP Borrowers |

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COVID-19 Update: SBA Released Streamlined Application for Some PPP Borrowers

 

October 9, 2020 

On October 8, 2020, following requests by many small businesses and lenders across the country, the Small Business Administration released a streamlined application for Paycheck Protection Program (PPP) borrowers who borrowed $50,000 or less (affiliate groups are excluded). The application, Form 3508S. Although Form 3508S is a shorter form, it is not an automatic approval for borrowers.

Form 3508S Highlights

  • A PPP loan borrower who received $50,000 or less is not required to reduce the forgiveness amount for salary reductions and changes in FTE’s due to de minimis exemptions added by the SBA and Treasury.
  • The application does not require the borrower to show their calculations related to forgiveness but it still must be done and documented should it be requested.
  • The new form does require the certifications by the borrower, most notably:
    • The dollar amount for which forgiveness is requested does not exceed the principal amount of the PPP loan and:
      • was used to pay costs that are eligible for forgiveness (payroll costs to retain employees; business mortgage interest payments; business rent or lease payments; or business utility payments);
      • includes payroll costs equal to at least 60% of the forgiveness amount;
      • if a 24-week Covered Period applies, does not exceed 2.5 months’ worth of 2019 compensation for any owner employee or self-employed individual/general partner, capped at $20,833 per individual; and
      • if the Borrower has elected an 8-week Covered Period, does not exceed 8 weeks’ worth of 2019 compensation for any owner-employee or self-employed individual/general partner, capped at $15,385 per individual.
    • Documentation of the payroll costs and other qualified expenses for the PPP loan still need to be submitted to the Lender.
  • Resources

BLS will continue to send important updates as information becomes available. Please be sure to visit our COVID-19 Resource Center for past guidance updates and additional details. Reach out to your BLS Team Member or email us at info@belfint.com with any questions.

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