The U.S. Small Business Administration and the Department of the Treasury announced Wednesday two new applications to seek PPP loans forgiven. One is more borrower friendly that accounts for changes made to the program through the Paycheck Protection Program Flexibility Act of 2020.
This new version of the forgiveness application asks borrowers to show at least 60% of their PPP funds were spent on payroll costs, rather than the original requirement of 75%.
A separate form, dubbed by the SBA as the “EZ Form,” was introduced to streamline the process for certain borrowers. The EZ form released is not based on the size of loans, but it might in practice address the request. The EZ application can be used by:
a. Those who are self-employed and have no employees.
b. Those who did not cut back pay for their employees by more than 25% and did not reduce their head count or workers’ hours.
c. Those who saw a drop in business activity because of health directives related to Covid-19 and did not cut back employees’ pay by more than 25%.
For business owners who received their PPP loans before June 5, both forgiveness applications allow the option of calculating forgiveness based on the original eight-week covered period for spending the funds, or the extended 24-week period.
Please see attached copy of both forms. When you are ready to apply and need assistance, please do not hesitate to request our services in this matter.