Dear Clients and Friends:
The U.S. Small Business Administration (“SBA”) and the Treasury Department published a new Interim Final Rule (“IFR”) regarding the Paycheck Protection Program (“PPP”) on October 8, 2020 that, inter alia, further simplifies the forgiveness and loan review processes for PPP loans of $50,000 or less.
The most significant element of this new IFR is that the SBA has issued a third alternative Loan Forgiveness Application, SBA Form 3508S, for use by PPP borrowers applying for loan forgiveness on PPP loans with a total loan amount of $50,000 or less. SBA Form 3508S is a significantly simplified loan forgiveness application and any PPP loan recipients that borrowed $50,000 or less, other than any borrower that together with its affiliates received loans totaling $2 million or greater, may use SBA Form 3508S (or lender’s equivalent form) to apply for loan forgiveness. In addition, any borrower that uses SBA Form 3508S (or lender’s equivalent form) is exempt from any reductions in the borrower’s loan forgiveness amount based on reductions in full-time equivalent (FTE) employees under section 1106(d)(2) of the CARES Act or reductions in employee salary or wages under section 1106(d)(3) of the CARES Act that would otherwise apply.
The Form 3508S is available here: https://home.treasury.gov/system/files/136/PPP-Loan-Forgiveness-Application-Form-3508S.pdf and the associated instructions are available here: https://home.treasury.gov/system/files/136/PPP-Loan-Forgiveness-Application-Form-3508S-Instructions.pdf.
Contact Your HH&K Attorney For Legal Guidance
This information is not legal advice and may not be suitable for all client situations. This Client Alert provides general information regarding the PPP program and does not outline all of the important considerations related thereto. We anticipate that the terms of the PPP program may continue to evolve as the SBA releases additional guidance. This Client Alert is not a substitute for legal guidance regarding program details and how those may be applicable to your business. As always, if we can be of assistance during this difficult time, please do not hesitate to contact your HH&K attorney.
| Erica L. Lawson Partner 80 Exchange Street Binghamton, NY 13901 Phone: (607) 231-6907 Email: elawson@hhk.com |
Copyright © 2020 by Hinman, Howard & Kattell LLP. This Client Alert is provided as a general information service to clients and friends of Hinman, Howard & Kattell, LLP. It should not be construed as, and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. These materials may be considered Attorney Advertising in some states.