We’ve already begun assisting many of you with PPP forgiveness.  If you’re a business owner, you most likely applied for a PPP loan to help your business during this pandemic.  We’ve recently provided a training on how to apply for PPP forgiveness, but we’d like to inform you of additional PPP news or considerations.

• Form 3508S – Recently, a new Form 3508S has been released and is intended for use by recipients of PPP funds totaling $50,000 or less. The form is intended to simplify the process of applying for forgiveness.  As you apply for forgiveness using Form 3508S, you will not be required to provide information proving that, during the covered period of your loan, neither your employee count decreased nor employee wages or salary decreased.  So if your employee count or wages or salary decreased, but your loan was $50,000 or less, Form 3508S is for you.  You can still be 100 percent forgiven if you reduced your workforce or wages or salary.
• If you have entirely used the PPP funds for qualified expenses (e.g. payroll, rent, utilities, or interest payments) and your PPP loan was $50,000 or less, apply now for forgiveness. And remember, you apply for forgiveness through your bank – not through SBA.
• If you have entirely used the PPP funds for qualified expenses and your PPP loan was more than $50,000 but you haven’t decreased your employee count or wages or salary, compared to February 15, 2020, apply now for forgiveness.
• If you have entirely used the PPP funds for qualified expenses and your PPP loan was more than $50,000 – but you have decreased your employee count or wages or salary – then it behooves you to wait until the end of the year to apply for forgiveness IF you plan on increasing your employee count or wages or salary by the end of the year. If you restore the employee count or wages or salary by December 31, 2020, you can still receive 100 percent forgiveness.

There are still many issues in the air.  “Blanket forgiveness” for all loans of $150,000 or less is still discussed by different groups, but no action has been taken regarding this “blanket.”  Also, we’re hoping expenses used by the PPP funds will be deductible, but the current IRS Notice 2020-32 paints the picture that, while the loan funds may not be directly taxable . . . the expenses for which the funds were used are not deductible.  So in the end, the forgiven funds are essentially taxable.  We’re hoping Congress will act by the end of 2020 to give us a positive direction regarding these and other issues.  Please let us know if you have any questions.  We’ll do our best to help.