The Small Business Administration released on August 4, 2020 a new set of frequently asked questions regarding the forgiveness of PPP loans. The document includes sections addressing general questions on loan forgiveness, questions related to forgiveness of payroll and non-payroll costs and questions on forgiveness reductions. You can access that document by clicking here.
The Paycheck Protection Program (“PPP”) administered by the Small Business Administration (“SBA”) continues to evolve as policy-makers decide how to administer the program as effectively as possible. As the forgiveness phase of the program begins, please note some recent developments that may assist you in the forgiveness process going forward.
On May 15, 2020 the SBA published a forgiveness application (“Application”) PPP borrowers must submit to lenders. The Application was lengthy and required a lot of detailed information to be submitted along with the Application. That Application has since been replaced by further guidance described below.
On June 5, 2020 President Trump signed the PPP Flexibility Act, which amended several aspects of the PPP program. A few amendments under the new law that may be favorable to PPP borrowers include:
On June 17, 2020, the SBA released a new, streamlined "EZ" forgiveness application and instructions, updates to the "full" forgiveness application and instructions, and an interim final rule that aligns prior SBA guidance with the PPP Flexibility Act. The new "EZ" application reduces the documentation and number of calculations required to apply for forgiveness and generally applies to the following:
Please consider the following as you evaluate your forgiveness options going forward:
Please continue educating yourself about the PPP program and the new PPP Flexibility Act as you consider forgiveness options. You can access current information from the following:
First Palmetto Updates: https://www.firstpalmetto.com/business/ppp/
We look forward to working with you on the forgiveness process. Like you, we receive and interpret updated information as it is made publicly-available. Work is underway to incorporate the most recent round of guidance, and we'll continue to adapt as new guidance is released to serve you as efficiently as possible. Thank you for your patience as we navigate this process together. We appreciate the opportunity to serve you.
Important Disclosure Information: First Palmetto Bank will process your application for loan forgiveness as the originating lender for your PPP loan based on the guidance and parameters established by the SBA or US Treasury, which may be subject to change. The SBA and/or US Treasury, and not First Palmetto Bank, sets criteria for loan forgiveness, including eligibility criteria and the parameters that determine how much of your loan may be forgiven. The SBA or US Treasury may instruct First Palmetto Bank to hold your loan forgiveness application if it decides to conduct a review of your application, or it may instruct the Bank to deny your loan forgiveness application. In its guidance, the SBA has indicated the reasons why it may decide to review an application for loan forgiveness.