By Lee Allphin, Employer Advantage Founder and Chairman of the Board
Employer Advantage is sharing important information to guide our clients during the Coronavirus pandemic. Please contact us if you would like assistance with any of your Employee Administration and Compliance responsibilities: Info@EmployerAdvantage.com | 877.958.9237
|On October 8, the Small Business Administration (SBA) announced a simplified Payroll Protection Program (PPP) forgiveness application for most loans of $50,000 or less. SBA also eased the burden on PPP lenders, allowing lenders to process forgiveness applications more swiftly.
Many borrowers have wisely waited to file for loan forgiveness, hoping for additional relief. Borrowers that are qualified to use Form 3508S should consider starting the process for loan forgiveness now. Borrowers under the $50,000 threshold are unlikely to see additional program changes
Here is a brief summary of the provisions of this new rule:
· Small business borrowers who had loans of less than $50,000 may use the new application and will benefit from the more relaxed rules associated with the application. However, if the loan was part of a group or affiliated business that in aggregate received more than $2,000,000 in PPP loans, the borrower may not use the new application.
· Those who qualify to use the new application will be exempted from any forgiveness reduction due to reduction in FTE counts or employee wages.
· The primary qualifier for forgiveness will be that the loan proceeds were used exclusively to pay qualifying costs. The definition of these costs remains unchanged. While these costs do not have to be detailed on the application itself, the borrower must still provide documentation of these costs as outlined in the instructions for the application.
Additionally, we strongly recommend consultation with your lender as questions arise, as they will be the primary arbiter of loan amounts qualifying for forgiveness.
Click here to read the SBA announcement.
Click here to view the simpler loan forgiveness application (Form 3508S).
Click here to view the instructions for completing the simpler loan forgiveness application.
Click here to view the Interim Final Rule on the simpler forgiveness process for loans of $50,000 or less.
Click here to see the affiliate business rules for PPP.
Click here to see our other helpful “Blogs for All Employers”
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A New Path to HR Bliss – Trusted for more than 30 years, Employer Advantage frees you from the administrative and compliance burdens of having employees so you can focus on your business success. Versatile enough for companies of all sizes, our unique service combines comprehensive management of your employee administration and compliance with the latest software solutions, tailored to meet your individual needs and company culture. Our full-service management of HR, payroll, health and benefits, workplace safety, and more, enhances your profitability while reducing the costs and risks associated with employment law compliance. We provide your employees with top-notch assistance and benefits that help you increase productivity, save time and money, and attract and retain a talented workforce. And for small and mid-sized businesses, we bring you economy of scale with access to Fortune-500-level benefits, specialty assistance, and savings that would not be possible to attain on your own. Headquartered in the Midwest and serving more than 400 companies and 10,000 worksite employees throughout the country, Employer Advantage is an IRS-Certified Professional Employer Organization (PEO) (C-PEO). Experienced, certified, and trusted. www.EmployerAdvantage.com