The Small Business Administration (SBA) updated the Paycheck Protection Program (PPP) FAQs and issued a new interim final rule in conjunction with the issuance of a new simplified loan forgiveness Application, Form 3508S, for borrowers that received a PPP loan of $50,000 or less. The new form exempts borrowers from reductions in loan forgiveness amounts based on reductions in full-time equivalent employees or reductions in employee salaries or wages.
Changes to Loan Review Rules
The SBA issued new loan review rules to incorporate the addition of the new Form 3508S. Under the new rules the lender must:
- confirm receipt of the borrower certifications contained in the SBA Form 3508S or lenders equivalent form; and
- confirm receipt of the documentation the borrower must submit to aid in verifying payroll and nonpayroll costs.
Providing an accurate calculation of the loan forgiveness amount is the responsibility of the borrower, and the borrower must attest to the accuracy of the reported information and calculations on the Loan Forgiveness Application. The borrower cannot receive forgiveness without submitting all required documentation to the lender.
Citing SBA-2020-0015, the SBA stated that lenders may rely on borrower representations. The lender does not need to independently verify the borrower’s reported information if the borrower submits documentation supporting its request for loan forgiveness and attests that it accurately verified the payments for eligible costs.
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