If your business received a Paycheck Protection Program (PPP) loan from the Small Business Administration (SBA), you should be keeping up-to-date with the agency’s guidance on these loans and working to ensure compliance with the relevant rules.
The SBA recently released new answers to frequently asked questions on PPP loan forgiveness that you can (and should) read here. These answers cover topics such as eligibility, owner compensation, payroll and non-payroll costs and more. The common question of how to maintain loan forgiveness if you offered to rehire an employee and that employee declined is also covered in this document. The FAQs took effect on August 11th.
The SBA also published the Interim Final Rule-Treatment of Owners and Forgiveness of Certain Nonpayroll Costs, effective August 24, which you can read here. This interim final rule supplements previously posted interim final rules and provides additional guidance on the treatment of owners and forgiveness of nonpayroll costs under the Paycheck Protection Program. Among other topics, this guidance tackles questions about forgiveness of PPP borrowers who share rented space, rent space to others or rent from a related party.
We implore all members of our industry who received PPP loans to review the above guidance and answers to ensure compliance with loan rules and prepare your business for forgiveness. As usual, we also encourage everyone to consult your attorney and bookkeeping professionals for advice on this topic.