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    SBA Releases 1-page PPP Forgiveness Application

    The SBA released a slew of PPP guidance and updates this week, including the new simplified, one-page forgiveness application for borrowers of loans for $150,000 or less - Form 3508S. Also, as of this week, the PPP is open to all lenders.


    Here's an in-depth look at the simplified application as well as some notes to consider.


    The new loan application is shorter - just one page long - and much easier to complete. In fact, you're no longer required to show the calculations you use to determine how much of your loan should be forgiven. Equally significant, the application no longer requires information from your Economic Injury Disaster Loan (EIDL) advance. These funds were originally supposed to offset your forgiveness amount but no longer do so.


    Identifying information you'll need includes:

    • SBA PPP Loan Number (the loan number assigned by the SBA at the time of approval)
    • Lender PPP Loan Number (the loan number assigned to the PPP Loan by your lender)
    • PPP Loan amount
    • PPP Loan disbursement date
    • Employees at the time of loan application
    • Employees at the time of forgiveness of the application
    • The covered periods (this is the eight- to 24-week period following the disbursement of the loan)
    • Amount of Loan Spent on Payroll Costs
    • Requested Loan Forgiveness amount

    Next, you have to certify that you complied with all the PPP rules (see list below), but you don't have to show the work behind them:

    • Eligible uses of PPP loan proceeds (remember this list was recently expanded)
    • The amount of PPP loan proceeds that must be used for payroll (at least 60% of the requested loan forgiveness amount)
    • The calculation and documentation of your revenue reduction (if applicable), and
    • The calculation of your loan forgiveness amount.

    The second certification is that the information you provide is true and correct "in all material aspects." Knowingly making a false statement could result in up to five years in prison and/or a fine up to $250,000. If you deceive a federally insured institution, that increases to up to 30 years and/or a fine of not more than $1,000,000. We urge you to retain your records to prove compliance for four years for employment records and three years for other records. And, really, since the SBA can ask for additional documentation if necessary, just keep every document related to your PPP loan in a safe place.

    Your lender will likely create its own electronic version of the application form, so don't waste time on the paper application. Again, the PPP is now open to all lenders, so the application should be available online from your lender shortly if not already.

    This is a great step forward in simplifying the forgiveness process, but we still urge you to reach out to us for help with calculations and documentation. Though we won't need to submit them with the application, the SBA could, down the line, request the information in a loan review or audit circumstance. We need to be prepared for anything!


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