How to Fill Out the PPP Loan Forgiveness Application

If you’re one of the many small business owners who have taken out a Paycheck Protection Program (PPP) loan, you may be wondering how to fill out the loan forgiveness application. Here’s a step-by-step guide to help you get it done.

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Introduction

The PPP loan forgiveness application is a complicated and lengthy document. Although the SBA released a simplified application for loans of $50,000 or less, most borrowers will still need to fill out the full document.

This guide will help you understand what information you need to gather and how to fill out each section of the PPP loan forgiveness application.

What You Need to Know Before Applying

The PPP loan forgiveness application is long and complicated. Borrowers should carefully review all the instructions and requirements before beginning the application process.

Here are some things you need to know before you begin:

-You must have used all of the loan funds for eligible expenses in order to have any of the loan forgiven.
-Eligible expenses include payroll costs, interest on mortgage obligations, rent, and utilities.
-You must apply for loan forgiveness within 10 months after the end of your covered period.
-You will need to provide documentation supporting your eligible expenses, such as bank statements, payroll records, and invoices.

If you have any questions about whether your expenses are eligible or how to fill out the application, you should consult with your lender or a qualified advisor before proceeding.

Applying for Loan Forgiveness

The PPP Loan Forgiveness Application consists of 4 parts:

Part 1 – Loan Forgiveness Calculation Worksheet

This is where you will calculate the amount of your loan forgiveness. The worksheet walks you through the calculation step by step.

Part 2 – Loan Forgiveness Application

This is your actual application for loan forgiveness. You will need to provide supporting documentation for your calculations from Part 1.

Part 3 – Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion – Small Business Concerns

This certification confirms that your business does not currently have any owners who are suspended or debarred from participating in federally funded programs.

Part 4 – Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion – Principle Owners

This certification confirms that the principal owners of your business are not currently suspended or debarred from participating in federally funded programs.

What to Do If You’re Denied Loan Forgiveness

If you think your lender made a mistake in denying your loan forgiveness, you have a few options. You can:

-Submit a written request for reconsideration to your lender
-If you’re still not satisfied, appeal the decision to the SBA
-What if I don’t agree with my lender’s decision?
If you think your lender made a mistake in denying your loan forgiveness, you can submit a written request for reconsideration to your lender. If they don’t overturn their decision, you can appeal the ruling to the SBA.

FAQs

-What are the basic eligibility requirements for loan forgiveness?
To be eligible for loan forgiveness, you must:
-Have used the loan proceeds for eligible payroll and non-payroll expenses, and
-Employ the same number of full-time equivalent employees as you did in the prior year
-Have reduced your employees’ wages by less than 25%, and
-Not have reduced your full-time equivalent employees or salaries by more than 25% during the covered period.

For more detailed information on eligibility requirements, please see SBA’s Interim Final Rule on Loan Forgiveness (https://www.sba.gov/document/support--sbar Chamber of Commerce v. U.S. Department of Treasury).

-How do I apply for loan forgiveness?
You will submit your application for loan forgiveness to your lender, not to the SBA. Your lender will then have 60 days to review and approve your application, and submit it to the SBA for final determination. The SBA will have 90 days to make a decision on your application. If you are approved, the SBA will remit payment to your lender within that 90 day period. You can find a copy of the application form here (https://www.sba.gov/document/forgiveness-application-ppp). Please note that this is a fillable PDF; you will need to download it before you can begin filling it out.

-Can I get an extension on my loan if I am unable to meet the terms of my original loan agreement?
Yes, borrowers may apply for an extension of their covered period from their lender at any time before the maturity date of their loan. For more information on extensions, please see SBA’s Interim Final Rule on Loan Forgiveness (https://www.sba.gov/document/support--sbar Chamber of Commerce v. U.S. Department of Treasury).

Conclusion

Now that you know how to fill out the PPP loan forgiveness application, you can begin the process of forgiveness for your business. If you have any questions about the process, be sure to consult with your accountant or financial advisor.