The Small Business Administration (SBA) has recently released guidance around the Paycheck Protection Program loan forgiveness application. The guidance helps clarify several items which were previously unclear under the PPP.
The new guidance includes:
- Information on the 75 percent rule when it comes to eligible payroll costs. The PPP requires that at least 75 percent of eligible expenditures during the covered period must relate to payroll. The new guidance notes that failing to meet the 75 percent threshold will not result in total loss forgiveness. Rather, it will only proportionately reduce the amount of forgiveness.
- Clarification on eligible nonpayroll costs. The new application clarifies rent obligations to include business rent or lease payments for real or personal property in force before February 15, 2020. The application also states nonpayroll eligible costs must be paid during the covered period or incurred during the covered period and paid on or before the next billing date.
- Updated documentation requirements. The application includes a list of documents borrowers will need to submit to their lender along with the forgiveness application.
Eide Bailly recently broke down the new guidance and what’s part of the loan forgiveness application. Learn more.
Full UTM Link: https://www.eidebailly.com/insights/articles/2020/5/new-ppp-loan-forgiveness-guidance-issued?utm_source=regional_chambers&utm_medium=referral&utm_content=backlink
