Since the Paycheck Protection Program (PPP) officially closed on May 31, 2021, there have been very few updates issued by the Small Business Administration (SBA). Most Atlanta borrowers have been focused on assessing loan forgiveness requirements, classifying expenses, making needed calculations, compiling documentation, and completing certifications. The forgiveness application options, especially for organizations with loans greater than $2M, are quite complex, often requiring detailed review prior to submission.
A controversial issue that has emerged over the past year is the requirement to complete a Loan Necessity Questionnaire. Originally mandated in May 2020, the form requested very detailed information about gross revenues, capital improvement projects, dividend payments, and compensation (including whether an employee earns more than $250,000). Many industry groups have stood opposed to the depth of disclosures requested in the document and subsequently filed a lawsuit against the SBA. Last week an important development occurred impacting these borrowers.
It was reported that on July 9th, the SBA issued a notice to lenders notifying them the Loan Necessity Questionnaire (SBA Form 3509/3510) will no longer be accepted as part of the loan forgiveness application. In addition, lenders were directed not to include any of the previously requested questionnaires with completed forgiveness applications. Finally, the change is effective immediately meaning those currently completing an application should not submit the questionnaire to lenders. The SBA is expected to issue a comprehensive FAQ about the change in the coming weeks.
The elimination of the loan necessity questionnaire allows borrowers to keep important financial and operational information off the public record. However, it is expected the SBA will continue to confirm loan necessity through other methods. If you have questions about the information outlined above or need assistance with PPP loan forgiveness, Wilson Lewis can help. For additional information call us at 770-476-1004 or click here to contact us. We look forward to speaking with you soon.
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