The Small Business Administration has introduced a third forgiveness application to the Paycheck Protection Program. Late in the day on October 8th, the SBA released Form 3508S, which is an application suitable for small businesses with PPP Loans of not more than $50,000.
The new application requires the borrower to certify their forgiveness amount but does not require the borrower to submit the calculation detail to the SBA. The loan information and required borrower certifications are consolidated into one page making this the shortest PPP loan forgiveness application available to date.
The borrower is required to submit their payroll and other expenses detail to the lender as well as retain this supporting documentation for at least six years. With the release of this new application, the SBA reaffirmed that calculation of the forgiveness amount is the responsibility of the borrower and lenders may rely on borrower representations.
While the streamlined application applies to less than 10% of CARES Act funds allocated for PPP loans, the application is sufficient for nearly two-thirds of all loan applications funded by the Act. Borrowers with loan amounts that exceed the $50,000 ceiling may use Form 3508 to submit their forgiveness calculation or the shorter Form 3508EZ if they meet an additional 2-part test.
More details about this can be found here.
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