The US Small Busines Administration and Department of the Treasury have announced that an expedited process has been created to apply for loan forgiveness for those who received Paycheck Protection Program Loans of $50,000 or less. With the exception of employers who, together with their affiliates, received loans totaling $2,000,000 or more, those who received loans of $50,000 or less can utilize SBA Form 3508S.
This new process has waived the reduction in loan forgiveness for eligible employers who did not maintain their employee headcount or were forced to reduce wages. Employers are also no longer required to show the calculations they used to determine their loan forgiveness amount. It has also reduced the amount of documentation required to be submitted along with the loan application; however, all records related to the PPP loan must be retained for six years after the loan forgiveness date as representatives of the SBA can request to view the file.
For businesses needing assistance with this form we recommend partnering with the Small Business Development Center. Businesses can receive assistance by going to myminnesotabusiness.com and choosing “Apply for Services”.
Documentation Still Required for Submission
Payroll: Documentation verifying the eligible cash compensation and non-cash benefit payments from the Covered Period or the Alternative Payroll Covered Period consisting of each of the following:
- Bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees.
- Tax forms (or equivalent third-party payroll service provider reports) for the periods that overlap with the Covered Period or the Alternative Payroll Covered Period:
- Payroll tax filings reported, or that will be reported, to the IRS (typically, Form 941); and
- State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported, or that will be reported, to the relevant state.
- Payment receipts, cancelled checks, or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that the Borrower included in the forgiveness amount.
Nonpayroll: Documentation verifying existence of the obligations/services prior to February 15, 2020 and eligible payments from the Covered Period.
- Business mortgage interest payments: Copy of lender amortization schedule and receipts or cancelled checks verifying eligible payments from the Covered Period; or lender account statements from February 2020 and the months of the Covered Period through one month after the end of the Covered Period verifying interest amounts and eligible payments.
- Business rent or lease payments: Copy of current lease agreement and receipts or cancelled checks verifying eligible payments from the Covered Period; or lessor account statements from February 2020 and from the Covered Period through one month after the end of the Covered Period verifying eligible payments.
- Business utility payments: Copy of invoices from February 2020 and those paid during the Covered Period and receipts, cancelled checks, or account statements verifying those eligible payments