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Good news for nonprofits who received PPP Loans of $2 million or more from the SBA. According to an article by Diana Ransom, Features Editor for Inc. Magazine[1], the SBA is no longer requiring the loan necessity review for PPP loans of $2 million dollars and above.
The SBA will also no longer require submission of SBA Form 3510 for nonprofits and SBA Form 3509 for any PPP Loan reviews.
In late June, The Journal of Accountancy highlighted the SBA was considering no longer requiring these two forms but had not yet made a final decision at that time. There is not currently a resource update on the SBA site in regard to this review change, but one is expected soon.
On deadlines for loan forgiveness the SBA notes, that “a borrower can apply for forgiveness once all loan proceeds for which the borrower is requesting forgiveness have been used. Borrowers can apply for forgiveness any time up to the maturity date of the loan. If borrowers do not apply for forgiveness within 10 months after the last day of the covered period, then PPP loan payments are no longer deferred, and borrowers will begin making loan payments to their PPP lender.”
For PPP loans, a key piece to loan forgiveness is retaining your payroll records and support for what your loan was applied to. According to Atchley and Associates, this is what the SBA will be focusing on in the event there are any questions about how the funds were used.
Borrowers with loans of $150,000 or less will only have to file Form 35085 for the forgiveness application. This form is simpler than other forgiveness applications and doesn’t require any calculations. Using this form, you will detail the forgiveness amount requested and certify with signatures.
The SBA offers more information and help for understanding loan forgiveness processing at its site.
Another superb resource on the PPP forgiveness issues and calculations, including the loan necessity questionnaires is AICPA’s Town Hall Webcast held on July 8th and free to watch in replay on AICPA TV .
At MIP Fund Accounting our mission is to serve your mission. If you’re interested in a demo of our fund accounting solution, we would be happy to walk you through one, submit a request here .
[1] https://www.inc.com/diana-ransom/small-business-administration-ppp-loan-necessity-questionnaire.html
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