PPP Forgiveness update information

The new norm during COVID-19 continues to challenge all of us. Some of us that in the first world and engaged in “the business of business” (hey, we’re management consultants) or information technology are going great – business is booming! Others in services, retail or energy industries are reeling still. For all of us in management, we now have to deal with the emergency measures put in place at the beginning of 2020 and COVID-19. This entry will deal with the process of PPP forgiveness for SBA PPP loans that 5.7 million business and individuals received.

Bottom Line for PPP forgiveness now…

Without spoiling anything, the whole process is in limbo right now. One client and myself called their bank, Chase Bank, to determine how to submit their application for the PPP Forgiveness. The short answer, “we haven’t opened up the online application process but you’ll get an e-mail with directions when we do.” In other words, we’re not ready yet, and we don’t think that it is the bank in this case because a dozen other clients with different banks all got the same answer.

Further discussion with bank officers led us to believe that none of the process will be online until November to the end of the year.

PPP Forgiveness Information Sources

The two definitive locations for information on PPP forgiveness are:

• SBA page for the Paycheck Protection Program
• U.S. Department of the Treasury’s website page – The CARES Act Provides Assistance to Small Businesses page

For PPP forgiveness, there are specific forms in PDF format provided by the SBA, but most PPP lenders require submission of PPP forgiveness applications through their own online submission forms (the government requires that all applications be done through their originators):

And there are many other miscellaneous documents, pages, and forms that round out the story:

• Frequently Asked Questions on PPP Loan Forgiveness (effective October 13, 2020)
• Frequently Asked Questions for Lenders and Borrows (updated October 7, 2020)
• Rules and Regulations, Small Business Administration 13 CFR Part 120 (updated April 15, 2020)

From those information sources, here are some interesting facts to note:

• Although independent contractor payments were not eligible to be forgiven as part of the PPP, the PPP was available for independent contractors and sole proprietors. (Question #15 on FAQ #2).
• Employment taxes paid by the employer are not eligible for forgiveness (Question #16 on FAQ #2).

Suggested Activity

Every company who is seeking PPP forgiveness will have individual circumstances that will dictate how you complete your application, but in general, here are some suggestions:

• If you use a Professional Employers Organization (PEO), like Questco, or payroll processor, like Paychex or QuickBooks Payroll, they more than likely have a report that will make your application much easier.
• Each SBA PPP loan originator, like Chase Bank, has their own website FAQ page that provides their current understanding of the program and any actions that can be taken.

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Further resources

• COVID-19 resources page
• DSV Consulting LLC’s crisis framework

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