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PPP Loan Forgiveness Application Now Available

Posted by Admin Posted on May 21 2020

The SBA has issued an application that provides additional information on the Paycheck Protection Program (PPP) loan forgiveness process. The application provides detailed instructions on how to calculate the loan forgiveness amount and provides clarification on timing, limitations and eligible costs.

Here are a few highlights we found after reviewing the application:

  • Alternative payroll covered period: Borrowers with bi-weekly or more frequent payrolls may elect to use an eight-week period that is based on the first day of the first pay period after the receipt of the loan. 
  • Payroll costs incurred: Those costs incurred, but not paid, during the period are eligible for forgiveness if they are paid by the next regular payroll date.
  • Eligible non-payroll costs: Costs must be paid during the covered period or incurred during the covered period and paid on or before the next regular billing date (even if that billing date is after the covered period).
  • New full time equivalent (FTE) reduction exemption: If you provided an employee with a written rehire offer and it was rejected, or if any employee was fired for cause or voluntary resigned or reduced their hours, you will receive an exemption from the loan forgiveness reduction for that employee.
  • Simplified FTE calculation: The borrower may choose to use a simplified FTE calculation where an employee who works 40 hours or more per week is considered 1 FTE. Any employee working less than 40 hours per week is calculated at 0.5 FTE. Companies will not have their forgiveness reduced if they had a reduction in FTEs from Feb. 15, 2020, through April 26, 2020, if they restore FTE levels to the prior amount (as of the Feb. 15, 2020, payroll period) by June 30, 2020.
  • Lease costs: Equipment leases (including copiers, vehicles, etc.) can be included in the forgiveness application if the lease agreement was in place before February 15, 2020, and the costs were incurred during the covered period.

Helpful links:


Your lender can provide additional clarification and support that is specific to your application. As always, our team is here to help as well.

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