The Small Business Administration (SBA) issued a new interim final rule (IFR) for the Paycheck Protection Program (PPP) under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) yesterday. The IFR provides a simplified forgiveness and loan review processes for borrowers with PPP loans of $50,000 or less, if such borrowers and their affiliates received PPP loans totaling $2 million or less in the aggregate. Under the IFR, these borrowers will be exempt from any reductions in loan forgiveness amount based on reductions in number of employees or reductions in wages and salaries as compared to pre-pandemic levels.

PPP borrowers that received loans of $50,000 or less, and who, together with their affiliates, received less than $2 million, will now be able to use simplified forgiveness application on SBA Form 3508S (Form 3508S), which will not require any calculations or reductions in forgiveness based on reductions in full-time equivalent (FTE) employees (section 1106(d)(2) of the CARES Act) or reductions in employee salary or wages (section 1106(d)(3) of the CARES Act) that would otherwise apply.

See our prior client alerts for more general information about the PPP and PPP loan forgiveness. Related articles may be found on Nelson Mullins’ COVID-19 resources website.

For more information, please feel free to contact:

• Jon Talcott at (202) 689-2806 or (202) 460-2197 (jon.talcott@nelsonmullins.com);
• Peter Strand at (202) 689-2983 (peter.strand@nelsonmullins.com);
• Mike Bradshaw at (202) 689-2808 (mike.bradshaw@nelsonmullins.com);
• Nick Garifo at (202) 689-2925 (nick.garifo@nelsonmullins.com); or
• Kaylen Loflin at (202) 689-2785 (kaylen.loflin@nelsonmullins.com).