Attention PPP Loan Recipients: Bulletin from the SBA

AAFCPAs would like to make clients aware of a recent bulletin issued by the Small Business Administration (SBA) affecting recipients of Paycheck Protection Program (PPP) Loans. The SBA sent this bulletin to lenders providing responses to some frequently asked questions and platform updates. While this bulletin was meant for lenders, some of the updates impact recipients of PPP loans. AAFCPAs has summarized the relevant updates below for your convenience.

Request a Manual Review of a Partial Forgiveness Decision

On January 27, 2022, the SBA issued Procedural Notice 5000-827666, where it describes a new rule that allows borrowers, who have received partial forgiveness but have not had the benefit of a manual review by SBA, to ask SBA to conduct such a review. Any manual review requests need to be made within 30 days of the notice of partial forgiveness from the SBA.

The module to accept these manual review requests in the PPP Platform is under development and therefore the SBA cannot currently accept these requests; however, borrowers should notify lenders of such requests as soon as possible.  Once the PPP Platform for manual review requests is operational, lenders will be able to enter all requests received by borrowers to date.  As long as the lender receives the manual review request from the borrower within the prescribed 30 days, the SBA will accept the request for review. As soon as the new module is operational, the SBA will issue another platform notification.

PPP Loan Extension

The maturity date of a PPP loan may be extended for up to 10 years beyond its original maturity date if the extension is granted before the SBA loan guaranty expires and the extension will aid in the orderly repayment of the loan.

If the SBA Arrives at an Adverse Decision During a Post Forgiveness Review

If the SBA identifies during a post forgiveness review that a loan should not have been forgiven, it will notify the lender that it has either identified that the loan was not eligible or that the SBA has identified fraud. At such time, the lender will receive instructions for recovery of any erroneously forgiven funds from the borrower.

Borrower Asks for Forgiveness After the PPP Loan Guaranty Has Been Purchased

Borrowers have the right to ask for forgiveness after the guaranty purchase on PPP loans (i.e., the loan has been converted to an SBA loan from a bank loan). Lenders must accept subsequent forgiveness requests, review them, and ultimately submit them to the SBA for consideration. The SBA is currently working to develop a process to allow the forgiveness requests to be entered into the PPP Platform after the guaranty purchase has occurred. Once the SBA reviews and concurs with the forgiveness requests, the SBA will then convert the guaranty purchase to a forgiveness decision.

If you have any questions or need assistance, please contact Enis Bezhani, CPA, MSA at 774.512.4045,; Courtney McFarland, CPA, MSA, at 774.512.4051,; or your AAFCPAs Partner.

AAFCPAs has helped numerous businesses obtain full forgiveness of their PPP loan and prepared ERTC filings that have resulted in additional funds.

About the Authors

Enis has extensive experience providing audit, tax, and advisory solutions to sophisticated nonprofit organizations, including charter schools and charter management organizations (CMOs), community development corporations (CDCs) and their affordable housing projects, and arts and cultural organizations. He specializes in directing teams in performing financial statement audits in accordance with Uniform Guidance/Single Audit and Government Auditing Standards, as well as those with U.S. Department of Housing and Urban Development (HUD), and Massachusetts Uniform Financial Statement (UFR) compliance requirements.
Courtney McFarland
Courtney is an audit partner in the firm’s Healthcare Practice with over 15 years of assurance experience and a comprehensive understanding of the nuances of the healthcare industry. She delivers a full range of solutions solving the challenges that AAFCPAs’ healthcare clients face, including: audits in accordance with Uniform Guidance/Single Audit and Government Auditing Standards, 340B pharmacy program requirements, best practices for reconciliation & analysis of statistical and programmatic data, tracking and monitoring risk-based contracts, maximizing reimbursements, and guidance on healthcare reform. Courtney is a member of AAFCPAs’ Revenue Recognition Task Force, dedicated to helping the firm and clients understand best practices for an efficient and effective implementation of the robust new framework.