How to Get PPP Loan Forgiveness

If you’re one of the many small business owners who took out a PPP loan to help get through the pandemic, you may be wondering about loan forgiveness. Here’s what you need to know about how to get PPP loan forgiveness .

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What is PPP Loan Forgiveness?

The Paycheck Protection Program (PPP) loan forgiveness process is for those who have used their PPP loan money for eligible expenses and have met the program’s guidelines. The Small Business Administration (SBA) will make the determination if your loan qualifies for forgiveness.

To apply for forgiveness of your PPP loan, you (the borrower) must submit a Loan Forgiveness Application to your lender. You will also need to submit documentation supporting your request for forgiveness, including receipts, invoices, and bank statements.

The SBA has stated that they will not accept any documentation that is submitted after the Loan Forgiveness Application is submitted. So, it’s important to have everything in order before you apply.

If you’re approved for forgiveness, the SBA will send a remittance advice to your lender with instructions on how to remit the forgiven amount to the SBA. You do not need to make any payments on a forgiven PPP loan. If you’re not approved for forgiveness, you will need to begin making payments on your loan, including principal, interest, and any fees that have accrued.

How to Get PPP Loan Forgiveness

The Paycheck Protection Program (PPP) loan forgiveness process is a complicated one. You must submit a number of documents to your lender and the Small Business Administration (SBA), and there are a number of rules you must follow to ensure that your loan is forgiven. This article will guide you through the process step-by-step so that you can get your PPP loan forgiven.

Applying for PPP Loan Forgiveness

The first step in applying for PPP loan forgiveness is to fill out the Loan Forgiveness Application Form 3508. This can be done online or downloaded and printed.

Once you have completed the form, you will need to gather the required documentation listed on the form. This includes your payroll records, tax forms, and bank statements. Once you have all of the required documentation, you will need to submit it to your lender.

Your lender will review your application and supporting documentation and make a determination on whether or not you are eligible for loan forgiveness. If you are approved, they will send you a forgiveness certificate which you will need to submit to the SBA.

The SBA will then review your application and supporting documentation and make a final determination on your loan forgiveness amount. If they determine that you are eligible for partial forgiveness, they will send you a check for the remaining balance of your loan.

Eligibility for PPP Loan Forgiveness

To be eligible for loan forgiveness, you must use your PPP loan proceeds for eligible payroll costs, interest on your mortgage, rent, and utilities (see more below) during either the covered period or the alternative payroll covered period. At least 60% of the proceeds must be used for paycheck protection program eligible payroll costs.

Eligible payroll costs include:
-Salary, wage, commission, or tip income for employees (when annualized, these amounts are capped at $100,000 on a pro rata basis)
-Employee benefits including paid leave, severance pay, health care benefits, and retirement benefits
-State and local taxes assessed on employee compensation
-Interest on any other debt obligations incurred before February 15, 2020 that are secured by real or personal property

Rent is defined as lease agreements in force before February 15, 2020 between the business and its landlord under which the business pays rent for property. Rent may also include monthly payments under land contracts in force before February 15

Documentation Requirements for PPP Loan Forgiveness

In order to qualify for loan forgiveness, you’ll need to save documentation on several things:

-Your payroll records proving you paid your employees during the covered period
-Proof that your employees retained their jobs or were rehired by October 31st
-How you spent your PPP loan funds
-A detailed calculation of your full-time equivalent employees

keep this documentation in a safe place—you may need it when you apply for loan forgiveness.

The Small Business Administration has released a forgiveness application form that borrowers will need to complete and submit to their lenders. You can find the form (SBA Form 3508) here.

Note: You won’t need to submit this form to the SBA—only to your lender.

What Happens if You Don’t Get PPP Loan Forgiveness?

If your application for loan forgiveness is denied, you will be responsible for repaying the full amount of your PPP loan plus any accrued interest. You may also be subject to additional fees and penalties from your lender.


There you have it—a complete guide on how to get PPP loan forgiveness. Just remember to complete and submit your application correctly and on time, and you should be well on your way to getting your loan forgiven. Good luck!

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