Accounting’s largest professional organization urged its members and small businesses that have accepted pandemic relief loans to hold off on filing for forgiveness from the Small Business Administration.
The Paycheck Protection Program, created in the CARES Act (Public Law 116-136), has facilitated hundreds of billions of dollars in government-backed, forgivable loans intended to help businesses stay afloat.
- With more guidance yet to come and an updated forgiveness application form still in the works, CPAs should urge loan recipients to wait until later in the summer to begin filling out forgiveness applications, Mark Koziel, executive vice president for firm services with the American Institute of CPAs, said during a Thursday webinar.
- Accountants instead should focus on helping eligible clients apply for loan before a June 30 deadline, Koziel said.
- The Treasury Department this week released an updated interim final rule to reflect a recently enacted law (Public Law 116-142) to offer more flexibility to loan recipients. The guidance also clarified that applicants who don’t use at least 60% of the funds to cover payroll costs will be eligible for proportional loan forgiveness.
- Treasury also said it would update forms for both new loans and forgiveness applications.