The new applications and a new Interim Final Rule (Revisions to Third and Sixth Interim Final Rule) released June 17 also updated guidance on compensation amounts eligible for forgiveness over the extended 24-week period. “For each individual employee, the total amount of cash compensation eligible for forgiveness may not exceed an annual salary of $100,000, as prorated for the Covered Period. For an 8-week Covered Period, that total is $15,385. For a 24-week Covered Period, that total is $46,154 for purposes of this 3508EZ,” the SBA said. For owner compensation (for owner-employees, self-employed individuals, or general partners), forgiven amounts for a 24-week covered period are capped at $20,833.
The longer updated Form 3508 still includes the Schedule A and Schedule A Worksheet and went from a single 11-page form that included instructions to a five-page application with a separate set of instructions that is seven pages. (Both old and revised forms include the optional demographic one-pager.) Documentation requirements remain the same for this longer form, and in general, borrowers preparing to file forgiveness applications using either of the revised forms will need to gather roughly the same materials.
“The EZ application requires fewer calculations and less documentation for eligible borrowers,” the SBA said in a news release announcing the new forms with the U.S. Treasury Department. “These changes will result in a more efficient process and make it easier for businesses to realize full forgiveness of their PPP loan.”
Note: Following the publication of this article, the SBA posted updated guidance on the forgiveness process incorporating changes from the PPP Flexibility Act and most importantly, how lenders are to submit forgiveness applications once lenders approve them. For more information, see the SBA and Treasury guidance section of Abrigo's CARES Act and Paycheck Protection Program Resources page.