SBA, Treasury Issue FAQs on Loan Forgiveness Issues
The U.S. Small Business Administration (SBA), in consultation with the Treasury Department, recently released guidance answering frequently asked questions (FAQs) regarding the forgiveness of Paycheck Protection Program loans. The Paycheck Protection Program (PPP) is a $669 billion business loan program established by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to help businesses keep their workforce employed during the COVID crisis. Management companies may have taken advantage of this assistance to meet payroll needs.
The FAQs are divided into four sections addressing different aspects of the process and calculations PPP borrowers should use to determine how much of their loan is forgivable. The sections include information on general loan forgiveness; loan forgiveness payroll costs; loan forgiveness non-payroll costs; and loan forgiveness reductions.
Through July 31, the PPP has funded nearly 5.1 million forgivable loans totaling more than $521 billion to help small businesses and other eligible entities impacted by the recession sparked by the COVID-19 pandemic. Congress is currently considering a follow-up to PPP that would provide more targeted assistance to small businesses.