PPP application forms released

The US Small Business Administration and Treasury released borrower loan application forms Friday night for the rebooted Paycheck Protection Program (PPP), which will launch Monday, initially for select lenders and borrowers before a broader opening takes place a few days later

The forms are Form 2483 – Paycheck Protection Program Borrower Application Form and Form 2483-SD – PPP Second Draw Borrower Application Form. Form 2483 is updated from previous iterations that started with the original PPP program. Form 2483-SD is a new form for qualified PPP borrowers to seek a second draw of  a forgivable loan as they try to navigate economic seas churning in the throes of the COVID-19 pandemic.

The SBA and Treasury also published top-line summaries of the first-draw and second-draw PPP loans and a pair of procedural notices.

The document release came after the SBA and Treasury announced earlier Friday that the application window for $284 billion in PPP forgivable loans would reopen Monday initially for community financial institutions (CFIs) that serve minority- and women-owned businesses to make loans. Specifically, CFIs can begin making loans to first-time PPP borrowers on Monday and second-time PPP borrowers on Wednesday.

The SBA and Treasury said the PPP would open to all lenders a few days after the opening for CFIs, but they did not specify a date.

Congress revived the PPP as part of the $900 billion COVID-19 relief bill that was signed into law on Dec. 27. The original PPP provided $525 billion in forgivable loans over five months before it stopped accepting applications in August. The new PPP has $284.5 billion available, including $35 billion for first-time loans and $15 billion set aside for community financial institutions.

The SBA and Treasury issued guidance late Wednesday night for the new PPP, which shares many of the same rules as the old PPP but also has some significant differences. The guidance came in the form of three documents:

The PPP borrower application forms released Friday contain instructions on how to calculate payroll costs consistent with the guidance provided on Wednesday. In general, first- and second-time PPP borrowers may receive a loan amount of up to 2.5 times their average monthly payroll costs (with a cap per employee of $100,000 annualized) in 2019, 2020, or the year prior to the loan. PPP borrowers with North American Industry Classification System (NAICS) codes starting with 72 (such as hotels and restaurants) can receive up to 3.5 times their average monthly payroll costs on second-draw loans.

The forms also outline adjustments to the calculations for seasonal businesses, new businesses, farmers and ranchers, and partnerships.

The maximum loan amount is $10 million for first-time borrowers and $2 million for second-time PPP borrowers.

PPP borrowers can have their first- and second-draw loans forgiven if the funds are used on the following eligible costs: payroll, rent, covered mortgage interest, and utilities, covered worker protection and facility modification expenditures, covered property damage costs, covered payments to suppliers and payments for business software or cloud computing services that facilitate business operations, product or service delivery, and a number of back-office functions, including accounting.

To be eligible for full loan forgiveness, PPP borrowers must spend no less than 60% of the funds on payroll over a covered period of their choice between eight and 24 weeks.

First time PPP loans are available to borrowers that were in operations on Feb. 15, 2020 and are from one of the following groups:

Borrowers are eligible for a second-draw PPP loan of up to $2 million, provided they have:

AICPA experts discuss the latest on the PPP and other small business aid programs during a biweekly virtual town hall. The webcasts, which provide CPE credit, are free to AICPA members. Go to the AICPA Town Hall Series webpage for more information and to register.

Accounting firms can prepare and process applications for PPP on the CPA Business Funding Portal, created by the AICPA, CPA.com and fintech partner Biz2Credit.

The AICPA’s Paycheck Protection Program Resources page houses resources and tools produced by the AICPA to help address the economic impact of the coronavirus.

For more news and reporting on the coronavirus and how CPAs can handle challenges related to the outbreak, visit the JofA’s coronavirus resources page or subscribe to our email alerts for breaking PPP news.

— Jeff Drew (Jeff.Drew@aicpa-cima.com) is a JofA senior editor.

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