Ron Buck
Last Friday, the SBA/Treasury issued an Interim Final Rule (gotta love the oxymoron of just the name of this document) for “Requirements – Loan Forgiveness”, linked for your reference.
Some of the topics that you might find of interest:
2. Loan Forgiveness Process – What is the general process to obtain loan forgiveness?
3. Payroll Costs Eligible for Loan Forgiveness
- A. When must payroll costs be incurred and/or paid to be eligible for forgiveness?
- B. Are salary, wages, or commission payments to furloughed employees; bonuses; or hazard pay during the covered period eligible for loan forgiveness?
- C. Are there caps on the amount of loan forgiveness available for owner-employees and self-employed individuals’ own payroll compensation?
4. Nonpayroll Costs Eligible for Loan Forgiveness
- A. When must nonpayroll costs be incurred and/or paid to be eligible for forgiveness?
- B. Are advance payments of interest on mortgage obligations eligible for loan forgiveness?
5. Reductions to Loan Forgiveness Amount
- A. Will a borrower’s loan forgiveness amount be reduced if the borrower laid-off or reduced the hours of an employee, then offered to rehire the same employee for the same salary and same number of hours, or restore the reduction in hours, but the employee declined the offer?
- B. What effect does a reduction in a borrower’s number of full-time equivalent (FTE) employees have on the loan forgiveness amount?
- C. What does “full-time equivalent employee” mean?
- D. How should a borrower calculate its number of full-time equivalent (FTE) employees?
- E. What effect does a borrower’s reduction in employees’ salary or wages have on the loan forgiveness amount?
- F. How should borrowers seeking loan forgiveness account for the reduction based on a reduction in the number of employees (Section 1106(d)(2)) relative to the reduction relating to salary and wages (Section 1106(d)(3))?
- G. If a borrower restores reductions made to employee salaries and wages or FTE employees by not later than June 30, 2020, can the borrower avoid a reduction in its loan forgiveness amount?
- H. Will a borrower’s loan forgiveness amount be reduced if an employee is fired for cause, voluntarily resigns, or voluntarily requests a schedule reduction?
6. Documentation Requirements – What must borrowers submit for forgiveness of their PPP loans?
PPP-Interim Final Rule-Loan-Forgiveness Published 5-22-20
