Did you get a PPP Loan? Wonderful! Although information for loan forgiveness may be confusing to decipher, we put together some key points to help you understand the loan forgiveness process.
Application Due Date:
There is no formal due date to apply for loan forgiveness, however payments of principal and interest are due upon completion of the deferral period.
The SBA has issued clarification that payments of principal and interest is 10 months from date of loan funding. Even if the loan document state a 6 month deferral, banks must honor the 10 month deferral.
Loan Forgiveness Applications:
There are three applications available. Below is a list with criteria needed to use each one.
- Simplified Application (Form 3508S): Use this form if your PPP Loan was $50,000 or less.
- EZ Application (Form 3508EZ): Use this form if your PPP Loan was over $50,000 AND:
- Did not reduce the annual salary or hourly wages of any employee by more than 25% during the cover period. The borrower must review the annual salary or hourly wage rate for individuals employed during the cover period and compare to the average rate for those same individuals for the period of January 1, 2020 to March 31, 2020.
- Did not reduce the number of employees or the average paid hours of employees between January 1, 2020 and the end of cover period. Ignore reductions that arose from inability to rehire individuals who were employees on February 15, 2020.
- Standard Application (Form 3508): If you do not meet the criteria to use the EZ Form or Simplified Form.
*The above is a summary of rules and criteria. Contact Zomma Group at 305.444.8288 to discuss your loan in detail.