The SBA announced that they will pay the monthly principal and interest payments for all existing SBA back loans 7(a), 504 and micro loans other than PPP and EIDL automatically for six months. Borrowers do not need to apply for this assistance. For those clients that have SBA backed loans, you should contact your bank regarding this payment relief. Please see the attached link for details.
The SBA will issue final guidance by May 15th on loan forgiveness. We are hopeful the guidance will fix various issues and problems raised with loan forgiveness including FTE calculation, incurred and paid definition for expenses and period covered concerns for restaurant, hospitality and retail industries.
Reported on April 23rd, we were seeing guidance requiring you to spend at least 75% of the loan amount on Payroll Costs (payroll and related, employer portion of employee benefits and state and local employer payroll taxes) to get forgiveness on any Qualified Costs; rent, utilities, existing loan interest. We are happy to report that if you do not spend at least 75% on payroll costs, then the amount of Qualified Costs forgiven will be reduced proportionately.
If you have any questions, please do not hesitate to contact your Core accountant.