PPP Forgiveness Deadlines & Methods

First, the “not as good” news about PPP loan forgiveness:

  1. The deadline for obtaining PPP forgiveness is “10 months from the end of the covered period.”  For PPP loan recipients who received loans in calendar year 2020, that means the deadline to apply for forgiveness is approaching fast.
  2. The SBA has said they won’t make any “exceptions” for PPP borrowers who miss the deadline.  Those “asleep at the wheel” / miss the deadline people will see their “free money” PPP turn into a real loan that they need to pay back.

The GOOD NEWS, however, is this:

The PPP forgiveness process is, in most cases, EASY and FAST.

If you (or your clients) are filling out those confusing PDF document PPP applications (“Should I use the 3508EZ or the 3805S???”), you’re (probably) doing it wrong.  STOP!  There is (probably) an easier, better way.

The two best options for getting PPP forgiveness are:

  1. Go through the lender’s PPP forgiveness portal.  The bigger banks like Bank of America, Chase, etc. allow borrowers to apply for PPP forgiveness direct through their “online banking” function.  Here’s Chase’s portal, as an example.
  2. Use the SBA’s brand new PPP Direct Forgiveness portal — link here for you.

These portals “auto-fill” much of the actual PDF forgiveness application, based on borrowers answering (mostly) simple questions.  For example, the SBA Direct Forgiveness portal will “look up” the borrower’s PPP loan numbers based on the borrower’s Employer ID Number, and then auto-fill those loan numbers into the application rather than you (or your client) needing to track down the PPP Promissory Note to find that loan number.

I went through the SBA Direct Forgiveness portal with a couple clients recently and it was quite fast and easy.  One client completed the process entirely on his mobile phone, in less than 10 minutes.

In most cases, PPP borrowers can apply for forgiveness themselves, meaning that this does not need to become another dreaded task on your “to do list.”

Consider sending this info to your clients, so that they have clarity of what needs to be done and can take responsibility for their own situations.

For more complex PPP loan situations–larger loans, Employee Retention Credit interactions with PPP, etc.–then certainly there is a consulting opportunity for us as tax professionals, and you may or may not want to do that type of consulting.

93% of PPP loans are under $150K and should qualify for relatively “easy” forgiveness (minimal if any documentation required, etc.)

By the way, this is the kind of stuff we talk about in the Business Tax Verified Training Program with CPA Adam Shay.  We have live “mastermind” style meetings every week where we discuss among ourselves the most pressing issues facing our business clients.  If you’re already a Member, do yourself a favor and SHOW UP to these live weekly meetings; if you’re not a Member, here’s how to join up.