Paycheck Protection Program Loan Forgiveness
In the six months since the PPP was created, the only certainty about the program has been uncertainty. The PPP came into being due to the economic uncertainty which shut down much of the US economy. So far, the program has funded 5.2 million loans for a total of $525 billion.
The US Small Business Administration and US Treasury launched the program in only one week. Since March 27, 2020, over 53 changes to the program have been made. These changes have usually raised more questions with unknown answers at this time.
We know you are relying heavily on us to guide you through the process of seeking forgiveness for the loans. If you are ready to begin the process, please contact our office to get started!
If you are ready to apply for forgiveness and release the burden of your PPP loan, we are beginning to move forward with the forgiveness process. However, as has been the case since the beginning, much uncertainty still surrounds the PPP including the tax effect of PPP loan funds.
As we begin your forgiveness application process, we will continue to monitor changes stay on top of developments that may affect each one of you. Please keep in mind the deadline to submit the application for forgiveness is 10 months from the end of your covered period (8 or 24 weeks from funding) or 10 months from 12/31/2020, whichever is earlier. For most everyone that provides a due date range of March 2021 to end of October 2021 so there is no immediate rush.
Please begin to gather and provide the following information regarding your PPP Forgiveness Application for us to begin to work with your forgiveness application.
The original loan application if we did not help you apply. The original loan agreement.
- If you applied for the EIDL, a copy of the loan agreement.
- We will need access to your payroll. For ADP or Paychex payroll providers add John as your accountant to provide access. If you use another payroll service provide your username and password along with the name of the service and contact person. We will attempt to gather the needed reports on your behalf where-ever possible.
- Bank Statements or Bank Credentials- We instructed all of our clients to open a separate account in regard to use of the PPP funds. If we already have your bank credentials or are authorized on your accounts, we will attain needed documentation. Otherwise, we recommend very highly granting us access to lessen your burden. We will need copies of the bank statements from the initial deposit through the last bank statement in your possession check copies for the relevant PPP allowed transactions.
Essentially, each disbursement regarding PPP funds will need support documentation in the event of a PPP examination. Of course, there will possibly be additional information needed as we process your forgiveness application as well as questions regarding the representation of your application and your certification as to its accuracy.
There is a covered period of 8 weeks or 24 weeks regarding expenditures. In almost all cases, we will compute the for the covered period of 24 weeks.
We will begin completing your forgiveness application with information that we know will be needed as we await final regulations, some things will not change. We will await final approvals and policies to complete the applications.
Originally, the forgivable portion of the loan was not a taxable source of funds and the expenses attributable to the loan funds were a non-deductible expense on your tax filings.
Presently, the American Institute of Certified Public Accountants and other organizations are attempting to obtain the allowance of the expenses as an additional source of relief to the business community.
We feel that we must start somewhere. Call us today to get this process started. (248) 524-5240 – Info@franskoviakcpa.com