Question. My CPA just talked to my bank about loan forgiveness on my small PPP loan. To her surprise, the bank told her to sit on the application for forgiveness until fall because this banker heard that the SBA is going to simply forgive all loans under $500,000. I hope this is true. My wife is ecstatic thinking that she doesn’t have to do anything with all the records needed for our forgiveness. Do you have any insights on this?
Answer. Yes. But temper your hope—there is a twisty road from what we see now and a new law that provides automatic PPP forgiveness.
In a congressional committee hearing, Congressman Chabot asked Secretary Mnuchin about forgiving all PPP loans of $150,000 or less.
Secretary Mnuchin said that was something we should consider but added that we should obviously make sure there’s some fraud protection.
Senators seem warm to the idea.
·S. 4117 would create a one-page attestation form for automatic forgiveness of PPP loans of $150,000 or less. It has 23 cosponsors (three Democrats and 20 Republicans).2
·S. 4321 also creates automatic forgiveness for PPP loans of $150,000 or less and was introduced on Monday, July 27, 2020, by Senators Rubio and Collins.3
At this moment, these are the insights we have. We don’t have a projection on this becoming law, but we can hope.