Here is the most recent guidance from the SBA:

     o The “covered period” has been extended from June 30, 2020 until December 31, 2020
     o PPP loans made before June 5, 2020 have a maturity of two years unless the borrower and lender mutually agree to extend the maturity of such loans to five years. PPP loans made on or after June 5 have a maturity of five years
     o At least 60 percent of the PPP loan proceeds shall be used for payroll costs. For purposes of determining the percentage of use of proceeds for payroll costs (but not for forgiveness purposes), the amount of any refinanced EIDL will be included
     o The length of the covered period has been extended from eight to 24 weeks. For borrowers that received PPP loans before June 5, 2020, they may elect to use the original eight-week covered period
     o The amount of loan forgiveness can be up to the full principal amount of the loan plus accrued interest. The actual amount of loan forgiveness will depend, in part, on the total amount spent over the covered period on:

        ♦Payroll costs (for 24 weeks, a maximum of $46,154 per individual, or for eight weeks, a maximum of $15,385 per individual)

        ♦Owner compensation replacement, with forgiveness of such amounts limited to eight weeks’ worth (8/52) of 2019 net profit (up to $15,385) for an eight-week covered period or 2.5 months’ worth (2.5/12) of 2019 net profit (up to $20,833) for a 24-week covered period

        ♦Covered non-payroll expenses (interest on mortgage obligations, rent, utilities)

The latest PPP Loan Forgiveness Application incorporates these newest changes in the law. The Application and the Instructions are located at the links provided below.

There is a new EZ PPP Loan Forgiveness Application (links to the Application and the Instructions are provided below) which is available to Borrowers that fit into one of the following categories:

     o Borrower is a self-employed individual, independent contractor, or sole proprietor who had no employees at the time of the PPP loan application and did not include any employee salaries in the computation of average monthly payroll in the Borrower Application Form;
     o Borrower did not reduce annual salary or hourly wages of any employee by more than 25 percent during the Covered Period or the Alternative Payroll Covered Period compared to the period between January 1, 2020 and March 31, 2020 (for purposes of this statement, “employees” means only those employees that did not receive, during any single period during 2019, wages or salary at an annualized rate of pay in an amount more than $100,000); AND Borrower did not reduce the number of employees or the average paid hours of employees between January 1, 2020 and the end of the Covered Period; or
     o Borrower did not reduce annual salary or hourly wages of any employee by more than 25 percent during the Covered Period or the Alternative Payroll Covered Period compared to the period between January 1, 2020 and March 31, 2020 (for purposes of this statement, “employees” means only those employees that did not receive, during any single period during 2019, wages or salary at an annualized rate of pay in an amount more than $100,000); AND 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 requirements established or guidance issued between March 1, 2020 and December 31, 2020 by the Secretary of Health and Human Services, the Director of the Centers for Disease Control and Prevention, or the Occupational Safety and Health Administration, related to the maintenance of standards of sanitation, social distancing, or any other work or customer safety requirement related to COVID-19

EZ PPP Loan Forgiveness Application: https://home.treasury.gov/system/files/136/PPP-Forgiveness-Application-3508EZ.pdf

Instructions for the EZ PPP Loan Forgiveness Application: https://home.treasury.gov/system/files/136/PPP-Loan-Forgiveness-Application-Form-EZ-Instructions.pdf

PPP Loan Forgiveness Application Revised June 16, 2020: https://home.treasury.gov/system/files/136/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf

Instructions for PPP Loan Forgiveness Application Revised June 16, 2020: https://home.treasury.gov/system/files/136/PPP-Loan-Forgiveness-Application-Instructions_1_0.pdf

Interim Final Rule on Revisions to the Third and Sixth Interim Final Rules:
https://home.treasury.gov/system/files/136/PPP-IFR--Revisions-to-the-Third-and-Sixth-Interim-Final-Rules.pdf

The Attorneys at Levene Gouldin & Thompson, LLP are available to provide advice and counsel concerning these new statutory obligations and other matters related to COVID-19.