SBA, Treasury Release New EZ and Revised Full Forgiveness PPP Applications

SBA’s new rules have been published; last day to apply for a PPP loan is June 30

Yesterday the U.S. Small Business Administration, in consultation with the Department of the Treasury, posted a revised, borrower-friendly Paycheck Protection Program (PPP) loan forgiveness application that implements the PPP Flexibility Act of 2020. President Trump signed the Flexibility Act into law on June 5, 2020.  

READ MORE: PPP Flexibility Act Heads to Trump for Signature 

Click here to view the EZ Forgiveness Application. 

Click here to view the Full Forgiveness Application.

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 as a result 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. 

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.  

Flexibility Act Changes 

The Flexibility Act updated the PPP Program in a few key ways:

  • For loans made after June 5th, the maturity date is extended from two years to five years. For loans made prior to June 5th, it is possible to extend the maturity date, if the borrower and lender mutually agree.
  • Loan forgiveness coverage period has been extended from eight weeks to 24 weeks. That said, borrowers that received loans prior to June 5th can still opt for the eight-week period. 
  • The Flexibility Act reduced the amount that you needed to spend on payroll in order to obtain forgiveness from 75% to 60%.  
  • The Act extended the date to replace full-time equivalent employees (FTEs) and restore salaries from June 30, 2020 until December 31, 2020.