UPDATE | PPP LOAN - A LIFE LINE OR JUST A STRING ATTACHED ?
PPP LOAN - A LIFELINE OR JUST A STRING ATTACHED?
The PPP Loan program has been a lifeline for many of our clients over the last several months. However, shortly after the program kicked off, it became mired in controversy and bad press from all the stories of large corporations receiving funding. The immediate reaction was to add regulations that became a point of uncertainty and anxiety for many of our clients.
On May 13, the SBA and the Department of the Treasury provided additional guidance in the form of a Frequently Asked Questions release (find full release here). In short, the SBA has created a "Certification Safe Harbor" for a business that borrowed less than $2 million. The business that borrowed less than $2 million are automatically deemed to have made the financial-necessity certification on the loan application in good faith. While this does not guarantee forgiveness of the loan, it does shelter those businesses from facing the potential penalties from failing to show financial hardship.
This is very good news for many of clients who have faced the uncertainty from prior statements from the Treasury regarding audits and fraud charges.
Click here for the PPP loan forgiveness application.