New Simplified Forgiveness Application for PPP Loans of $50,000 or Less
If your business received a PPP loan of $50,000 or less, you can use a new, one-page application to apply for forgiveness of your loan. This new simplified form, Form 3508S, requires fewer calculations and less documentation than the other two PPP forgiveness applications.
If your company’s PPP loan was $50,000 or less, you are eligible to use the new Form 3508S even if you had to lay off employees or reduce your employees’ wages during the pandemic.
Form 3508S only requires your company to confirm that its PPP loan was used for eligible costs (payroll, including health insurance and retirement benefits paid by the company; business utilities; and business rent) and to provide supporting documentation showing payment of these expenses during the covered period.
The covered period for your company’s loan started the day the loan was received and either lasts 8 weeks or 24 weeks, depending on the date you received your loan.
If your company received its PPP loan before June 5, 2020, your loan’s covered period is either 8 weeks or 24 weeks, whichever you choose. If you received your PPP loan after June 5, 2020, your loan’s covered period is 24 weeks after the date you received your loan.
For payroll costs, you will need to submit documentation that shows the cash compensation (wages) you paid to employees and the non-cash benefits (amount the company paid for employee health insurance and retirement benefits) you paid on behalf of employees during the covered period. Each of the following is required:
- Bank statements (or reports from your company’s payroll service) that show the wages paid to employees;
- Payroll tax filings with the IRS (941s); and
- Receipts, cancelled checks, or bank statements showing the amount of employer contributions to employee health insurance and retirement plans that you included in your company’s forgiveness amount (receipts for health insurance and retirement benefits are only required if you are including these expenses in your forgiveness amount).
For non-payroll costs,you will need to submit documentation verifying eligible payments during the covered period:
- Rent: A copy of the current lease agreement as well as receipts or cancelled checks showing actual payments during the covered period.
- Utilities: Copies of invoices showing these expenses as well as receipts, cancelled checks, or bank statements showing actual payments during the covered period.
The only calculation required on Form 3508S is the amount of forgiveness the company is applying for. If the company spent its entire PPP loan on approved expenses during the covered period, the amount of forgiveness will equal the amount of the PPP loan. Please note: The amount of forgiveness you request on Form 3508S cannot exceed the amount of your PPP loan.
Businesses choosing to use the extended 24-week covered period will probably have used their entire PPP loan on payroll costs and will not have to include any non-payroll costs like rent and utilities in their forgiveness application. If your company received a PPP loan of $50,000 or less and used the entire PPP amount on payroll to employees, you can simply submit bank statements or cancelled checks plus the 941s you filed during the covered period as proof that you spent the loan on payroll.
PPP Loan Forgiveness Update for Loans Over $50,000
If your company received a PPP loan of more than $50,000, you may be waiting to file your PPP loan forgiveness application to see if Congress acts to automatically forgive PPP loans under $150,000. This has not happened yet, but because businesses have 10 months after the end of their covered period to apply for forgiveness, there is plenty of time to see if this law is approved after the election. Because the forgiveness applications are so complicated, many businesses are holding off on filing forgiveness applications in the hopes that this law will be approved.
FUBA members with questions about PPP loan forgiveness can ask our experts by calling us at 800-262-4483.
State Minimum Wage Increasing Again for 2021
Starting January 1, 2021, the Florida minimum wage will increase from $8.56 an hour to $8.65 an hour. The minimum cash wage for tipped employees is also increasing, from $5.54 an hour to $5.63 an hour.
With this change to the Florida minimum wage, all Florida employers will be required to display a new minimum wage poster for 2021. One of the most important benefits of your company’s continued FUBA membership is that we provide you with all updated posters free of charge. Please look for the 2021 Florida minimum wage poster with your December newsletter.
If you have any questions about the minimum wage and how it affects your business, please call the FUBA offices at 800-262-4483 and ask for Karen or Stacey.
Newsletter Will Be Sent Via Email Only Starting January 1st
We are phasing out hard copies of this newsletter delivered through the US mail. Starting with the January newsletter, we will be sending it via email only, although hard copies will be available upon request.
If you received a copy of this newsletter in your email inbox, you are signed up for emails from us and you do not need to do anything else to continue receiving our newsletter.
If you only receive the newsletter via the US mail, please make sure we have a valid email address on file for you or your business. Simply send us an email at email@example.com with the word “newsletter” in the subject line. Please include your company name and address so we can make sure to link your email to your company’s membership.