Last week, the SBA released a new PPP Loan Forgiveness Application, Form 3508EZ and also revised the original Form 3508 long form. These forms are simpler to complete and will benefit many small businesses with the reduction of calculations and broad certification of adhering to the program guidelines.
New Form 3508EZ
Businesses that meet ANY of the following may be able to use the new 3508EZ form:
- Are self-employed AND have no employees
- Did not reduce the salaries or wages of your employees by more than 25% AND did not reduce their average number of hours worked.
- Did not reduce the salaries or hourly wages of your employees by more than 25% AND had a reduction in business activity due to the COVID-19 health directives.
Reminders and Additional Clarifications
- Businesses can apply for forgiveness within 10 months of receiving loan funds.
- Businesses can choose an 8-week covered period or 24-week covered period.
- Payroll cost requirement has been decreased from 75% to 60%.
- Loans originating after 6/5/20 have a 5-year term; Loans originating prior to 6/5/20 have a 2-year term but the lender has the option to extend to 5-year.
- Any amount not forgiven, the loan’s balance, will have its first payment due after the SBA reimburses the lender for the forgiven portion or gives notification of denial.
- Many banks are not yet prepared to accept forgiveness applications and many are asking for additional guidance and clarification from the SBA. For example, Chase just announced that they will begin accepting applications in mid-August only from those who received funds in April, by invitation.
- Currently, there is no benefit to expedite the forgiveness application submission process. It may be in the best interest of businesses to wait for potential additional information from the SBA.
Forms and Instructions
If you are interested in engaging BeanLab for PPP Loan Forgiveness services, please contact us by email at beanlabteam@beanlab.com.
