An Update on PPP Loan Forgiveness


In a year that’s been unlike any other, we’re all thankful for any help we can get. If your small business took advantage of the Paycheck Protection Program (PPP) loan that became available earlier this year, you may have some confusion over the forgiveness process and how it works.

This guide is here to help clear things up.

Who Qualifies for PPP Loan Forgiveness?

Small businesses that used 60% of the money from the loan toward payroll and the other 40% to other allowable expenses (including rent, some utilities, and certain employee benefits) should qualify for PPP loan forgiveness.

Additionally, it has recently been announced that loans under $50,000 for businesses with no employees or businesses where the owner is the sole employee are eligible to have most or all of their loan forgiven.

PPP Loan Forgiveness Applications

There’s been some confusion over the due date for the PPP forgiveness loan applications, due to an “expiration date” on the form of 10/31/2020. However, the Journal of Accountancy reports that this does not represent a due date, according to the U.S. Small Business Administration (SBA).

Their report on the issue states:

“…the SBA explains that borrowers may submit a loan forgiveness application any time before the maturity date of the loan, which is either two or five years from the loan’s origination, depending on the borrower’s agreement. But the SBA also reminds borrowers that loan payments are deferred only until 10 months after the last day of each borrower’s loan forgiveness covered period.”

Businesses that received loans of $50,000 or less need to only fill out a one-page SBA form and have it processed by their lender.

It has also been speculated that some smaller loans (those less than $150k-$250k) could become eligible for automatic forgiveness.

Timeline for PPP Loan Forgiveness

As of the end of September, not a single PPP loan had yet to be forgiven, but that should change soon. As reported by, the U.S. Department of Treasury said it expects to start approving forgiveness requests in October.

To date, forgiveness applications have been submitted for about only 2% of the total loans, but the Treasury Department expects approvals to go quickly once they get started. Although, for loans totaling $2 million and up, you can expect the approval process to take a bit longer.


We know this is a difficult time, especially for small business owners, and we encourage you to browse through our Business Management articles for more guidance.


*The above is an interpretation of the publically available information from the Small Business Administration and other resources. For guidance on your specific situation, please consult your financial and/or tax advisor.