SBA Issues a Short Form for Easy Application for PPP Loan Forgiveness
Posted July 2020
The Small Business Administration (SBA) has released Form 3508EZ, a simplified loan forgiveness form for entities that took part in the Paycheck Protection Program (PPP). Per the SBA, loan forgiveness will be based on the employer keeping employees or rehiring quickly to maintain salary levels. The forgiveness will be reduced if the number of full time employees decreases, or if wages decline.
Copy of Form 3508EZ can be found here.
Instructions can be found here.
The Form 3508EZ is available for borrowers meeting one of the following criteria:
- The borrowers applied for forgiveness as a Schedule C with no employees.
- The borrowers did not include any employee salaries in the loan application computation.
- The borrowers did not reduce annual salary or hourly wages of any employee by more than 25% during the covered period compared to the period between January 1, 2020 and March 31, 2020. Exclude any employee who received a paycheck in 2019 that had an annualized pay of more than $100,000.
- The borrowers did not reduce the number of employees or average paid hours of employees between January 1, 2020 and the end of the covered period.
- The borrowers did not reduce annual salary or hourly wages of any employee by more than 25% during the Covered Period compared to the period between January 1, 2020 and March 31, 2020. Exclude any employee who received a paycheck in 2019 that had an annualized pay of more than $100,000.
- The borrower was unable to operate during the covered period at the same level of business activity as before February 15, 2020 due to compliance with the Department of Health and Human Services (HHS), Centers for Disease Control (CDC), or Occupational Safety and Health Administration (OSHA) directives.
If one of these scenarios match your situation, 3508EZ can be submitted to your lender by October 31, 2020. If you need any assistance or have questions, please contact us.