Language in the COVID-19 relief package makes common sense changes to simplify the process for applying for forgiveness of Paycheck Protection Program (PPP) loans of $150,000 or less. That’s good, although the legislation should have required Treasury and the Small Business Administration to releasee the names of those recipients as well, which they have refused to do even though the bulk of the PPP loans are in this category. Regardless, under the new rules the party must sign and submit a letter that:
‘‘(I) shall be not more than 1 page in length; and
‘‘(II) shall only require the eligible recipient to provide—
‘‘(aa) a description of the number of employees the eligible recipient was able to retain because of the covered loan;
‘‘(bb) the estimated amount of the covered loan amount spent by the eligible recipient on payroll costs; and
‘‘(cc) the total loan value;
Attests that the eligible recipient has—
‘‘(I) accurately provided the required certification; and
‘‘(II) complied with the requirements under section 7(a)(36); and
Retains records relevant to the form that prove compliance with such requirements—
‘‘(I) with respect to employment records, for the 4-year period following submission of the form; and
‘‘(II) with respect to other records, for the 3-year period following submission of the form.”
At first glance this looks like a lot of information for a one page letter to the SBA. But, we boiled it down for you. Your application must state:
- How many people did you keep on the payroll?
- How much of the loan did you spend specifically on payroll?
- What was the size of your loan?
After that, you must attest the information is accurate, that you didn’t bend any rules to get the loan, and that you will hang on to records for several years to prove the facts to which you are attesting. Loan recipients should be able to do that in one page – you can even use large margins and double spacing, to make it look like more information. Not that anyone at Taxpayers for Common Sense ever did that on a term paper…(ahem!)