Here is a new idea to share with your small clients that might want to apply for the new EZ or revised Full Forgiveness loans.
Check out the two new SBA loan applications to see what you might need to do to qualify.…
Remember the U.S. Small Business Administration, posted this week a revised, borrower-friendly Paycheck Protection Program (PPP) loan forgiveness application implementing the PPP Flexibility Act of 2020, signed into law by President Trump on June 5, 2020.
In addition to revising the full forgiveness application, SBA also published a new EZ version of the forgiveness application that applies to borrowers that:
- Are self-employed and have no employees, OR
- Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees, OR
- Experienced reductions in business activity because of health directives related to COVID-19 and did not reduce the salaries or wages of their employees by more than 25%.
The EZ application requires fewer calculations and less documentation for eligible borrowers. Details regarding the applicability of these provisions are available in the instructions to the new EZ application form.
Both applications give borrowers the option of using the original 8-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period.
These changes will result in a more efficient process and make it easier for businesses to realize full forgiveness of their PPP loan.
You may need the help of a professional CPA during this process so make sure you also check out the AICPA website on the subject for some additional ideas.
Here is a great article t from the Journal of Accountancy that will help walk you through the details.
“AICPA issues guidance on accounting for forgivable PPP loans” https://www.journalofaccountancy.com/news/2020/jun/forgivable-ppp-loans-aicpa-accounting-guidance.html
Good Luck !!!