Alert: PPP Good-Faith Certification Review Guidance

Alert: PPP Good-Faith Certification Review Guidance

05/13/2020 Tags: Announcements, In the News, COVID-19, PPP

If you’ve submitted a Payroll Protection Program loan application for your business, you might recall the required good-faith certification. Essentially, you had to certify that your loan request was necessary to support your business’s ongoing operations.

The Small Business Administration and U.S. Department of the Treasury have determined a safe-harbor clause for certain applications. For a PPP loan that’s less than $2 million, the SBA will deem that the borrower has made the required good-faith certification concerning the necessity of the loan.

The SBA has determined that this safe harbor is appropriate because borrowers with loans less than $2 million are usually less likely to have access to enough cash compared to borrowers who apply for larger loans. Also, because of the large number of PPP loans and applications, this approach will allow the SBA to conserve resources to focus on reviewing larger loans.

Source: U.S. Department of Treasury Paycheck Protection Program Loans Frequently Asked Questions as of May 13, 2020 — Question #46

This communication is intended to provide general information on legislative COVID-19 relief measures as of the date of this communication and may reference information from reputable sources. Although our firm has made every reasonable effort to ensure that the information provided is accurate, we make no warranties, expressed or implied, on the information provided. As legislative efforts are still ongoing, we expect that there may be additional guidance and clarification from regulators that may modify some of the provisions in this communication. Some of those modifications may be significant. As such, be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed.

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