Finally an update regarding PPP loans from the American Institute of Professional Bookkeepers.
Here's the basics - feel free to reach out to us for further information!
Borrowers of $50,000 or less do not have to:
maintain the number of employees formerly employed; or
ensure that employee compensation was not reduced by more than 25%; or
provide data on employee hours and salaries on the application; or
show calculation of the requested forgiveness amount. Borrowers need only state the amount of the loan they believe qualifies for forgiveness. Lenders do not have to verify the claim or review borrowers’ receipts or other documents to verify the forgiveness amount.
But PPP borrowers are still potentially subject to audit in the future, so keep records that prove your firm qualifies for loan forgiveness.
PPP borrowers who own multiple businesses can use the simplified process for each loan that is no more than $50,000 as long as total loans of the “affiliated businesses”—those in which the owner controls more than 50% of the voting equity—are less than $2 million. There are other rules when stock options and other types of ownership interests are involved and when ownership is divided among close family members.
See Federal Register “Rules and Regs” for details.
[RIN 3245-AH59, Business Loan Program Temporary Changes; Paycheck Protection Program–Additional Revisions to Loan Forgiveness and Loan Review Procedures Interim Final Rules, SBA]
If your small or large business needs professional bookkeeping services, give us a call! It's always best to hire a professional.
As published in the AIPB General Ledger, December 2020.