PPP New update

[BOB W]

PPP FUNDS can be used for up to 24 weeks instead of 8 weeks and total forgiveness of all loan proceeds as long as 60% was used for payroll. Nothing is said about rent, utilities and such because it doesn't matter. WOW WOW

[Lion]

The percentage that is NOT spent on payroll, must be spent on allowable expenses to be forgiven, as much as 40% of the loan.

[ATSMAN]

Anyone charging (approx how much) to prepare SBA Form 3508EZ?

I think most of my clients can use the EZ version.

[mhcpa1964]

I'm planning on charging where possible. Not sure how much but not an exorbitant amount. Depends in part on whether I handle their PR/Financial Statements or not.

[Lion]

I'm having my clients wait. There might be a simple, signed attestation for loans under $150,000 which is probably all but one of my clients. If clients need my help, my hourly rate. But the 3508EZ will not take much time at all. Depending on their other fees to me, I might throw it in for goodwill.

[JON]

Remember the 60% is a cliff. If you do not achieve it the loan has to be paid back, 100%. They have talked about the $150,000 since the start. Supposedly the act which was to be done today was going to reference it!?? Guess what no reference, no act. The other rumor is the SBA was not reviewing anything until Aug 10???

[Lion]

The cliff is no more. PPP Flexibility Act 5 June 2020. https://www.forbes.com/sites/alangas.../#40bae72036dc

“Joint Statement by Treasury Secretary Steven T. Mnuchin and SBA Administrator Jovita Carranza Regarding Enactment of the Paycheck Protection Program Flexibility Act,” U.S. Department of the Treasury website, June 8, 2020, https://home.treasury.gov/news/press...Gz-FqJc.mailto (retrieved June 8, 2020)

[JON]

The statement generally reiterates what the new law provides, with one change that will apparently be made, and one clarification that will be important to borrowers.

Change "apparently to be made" - was it made??? Was it MADE?????

[Lion]

If you click on the above Treasury link, it says...

SBA, in consultation with Treasury, will promptly issue rules and guidance, a modified borrower application form, and a modified loan forgiveness application implementing these legislative amendments to the PPP. These modifications will implement the following important changes:

• Extend the covered period for loan forgiveness from eight weeks after the date of loan disbursement to 24 weeks after the date of loan disbursement, providing substantially greater flexibility for borrowers to qualify for loan forgiveness. Borrowers who have already received PPP loans retain the option to use an eight-week covered period.
• Lower the requirements that 75 percent of a borrower’s loan proceeds must be used for payroll costs and that 75 percent of the loan forgiveness amount must have been spent on payroll costs during the 24-week loan forgiveness covered period to 60 percent for each of these requirements. If a borrower uses less than 60 percent of the loan amount for payroll costs during the forgiveness covered period, the borrower will continue to be eligible for partial loan forgiveness, subject to at least 60 percent of the loan forgiveness amount having been used for payroll costs.

...which the two newest forgiveness applications, Forms 3508 and 3508EZ, follow by using partial loan forgiveness in their computations. Although, the SBA seems to be on hold for forgiveness until about 10 August in case there are more changes.

If you're in a hurry to apply for forgiveness for yourself or clients, use the latest 3508 &/or 3508EZ and follow the current calculations. Research.

I'm waiting to see what else Congress enacts and how the IRS, SBA, and my friendly, local lenders interpret forgiveness.

Relax. Breathe.

[ATSMAN]

If you click on the above Treasury link, it says...

SBA, in consultation with Treasury, will promptly issue rules and guidance, a modified borrower application form, and a modified loan forgiveness application implementing these legislative amendments to the PPP. These modifications will implement the following important changes:

• Extend the covered period for loan forgiveness from eight weeks after the date of loan disbursement to 24 weeks after the date of loan disbursement, providing substantially greater flexibility for borrowers to qualify for loan forgiveness. Borrowers who have already received PPP loans retain the option to use an eight-week covered period.
• Lower the requirements that 75 percent of a borrower’s loan proceeds must be used for payroll costs and that 75 percent of the loan forgiveness amount must have been spent on payroll costs during the 24-week loan forgiveness covered period to 60 percent for each of these requirements. If a borrower uses less than 60 percent of the loan amount for payroll costs during the forgiveness covered period, the borrower will continue to be eligible for partial loan forgiveness, subject to at least 60 percent of the loan forgiveness amount having been used for payroll costs.

...which the two newest forgiveness applications, Forms 3508 and 3508EZ, follow by using partial loan forgiveness in their computations. Although, the SBA seems to be on hold for forgiveness until about 10 August in case there are more changes.

If you're in a hurry to apply for forgiveness for yourself or clients, use the latest 3508 &/or 3508EZ and follow the current calculations. Research.

I'm waiting to see what else Congress enacts and how the IRS, SBA, and my friendly, local lenders interpret forgiveness.

Relax. Breathe.

Lion is correct, it is prudent to wait and see. What is the real rush? I have advised my clients that I will not be able to help them until final guidance is released because I am not doing this twice!

[Jiggers]

I have 2 clients who applied for on their own and received the PPP. Will they now receive the SBA 3508EZ or something that they must complete and return?

[Lion]

Your clients will apply for forgiveness using their lender's online application. My bank emailed me to wait, because their online application is not ready yet. Your clients may have to take the initiative themselves or they might receive an email from their lender with their application is ready. (SBA is not reviewing applications forwarded from lenders until 10 August or so.) Tell your clients to ask their lenders what their next steps are.