Preparing Documentation for PPP Forgiveness

Preparing Documentation for PPP Forgiveness

While we all wait for guidance from the SBA concerning the forgiveness of PPP loans, borrowers need to consider taking steps now to help them document their request for forgiveness.  For the best chance at the maximum amount of loan forgiveness, you should:

  • Create a separate bank account to deposit and disburse the PPP loan proceeds.  Your lender may even be able to open a new account for you with them just for the PPP loan, allowing for easier tracking.  Make sure that you move funds out of this account directly to your payment account, and in the exact amounts to be paid. 
  • Consider a separate code for costs incurred during the forgiveness period, and monitor spending throughout the period to ensure that at least 75% of the PPP loan proceeds are spent on payroll costs.
  • Maintain records for all potentially forgivable payments, including all federal and state taxes paid with payroll, mortgage interest, rent, and utilities.  
  • Keep good records of employees offered to be re-hired, as well as those actually hired back, along with their position and pay rate. 
  • Understand that you may need to run an off-cycle payroll on the last business day of the eight-week period to capture all eligible payroll expenditures. ​

Begin to speak with your lender about the forgiveness process and inquire as to when they expect to have their process and documentation requirements available.​

-  Courtesy Kuttin Wealth Management