The Consolidated Appropriations Act (“CAA”) signed into law on December 27, 2020, required the Small Business Administration (“SBA”) to provide a simplified application for forgiveness of Paycheck Protection Program (“PPP”) loans of less than $150,000. The new application Form 3508S has just been released.
Form 3508S is available for use only for loans of $150,000 or less, and only for borrowers who, with their affiliates, have borrowed less than $2 million in PPP loans.
Despite the simplified form of application, all PPP loan requirements, such as the use of at least 60% of proceeds for payroll expense, continue to apply. Instead of requiring borrowers to submit documentary evidence as to their use of loan proceeds, Form 3508S only requires a certification to this effect. Note, however, that the lender or SBA reserves the right to require the provision of such documentation in the future, so borrowers should collect and review their documentation before requesting forgiveness.
If you have any questions about your business’ eligibility for PPP loans, forgiveness or another PPP concern, contact Douglas Lubic, Peter Greenbaum or another member of the Wilentz Corporate Law Team.
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