For small business owners who scored a loan through the Paycheck Protection Program (PPP), not having to pay back what they borrowed is a huge bonus. As currently constructed under the CARES Act, the PPP lets small businesses borrow up $10 million without collateral, personal guarantees, or fees. The loan doesn’t have to be repaid to the extent it’s used to cover the first eight weeks of the business’s payroll costs, rent, utilities and mortgage interest. However, at least 75% of the forgiven amount must be used for payroll. (Note that a bill working its way through Congress would extend the eight-week period to 24 weeks and reduce the 75% threshold to 60%.)

To have their PPP loans forgiven, small-business owners must first submit an 11-page application to the bank or lender that approved their initial loan request. The application, along with other recently released guidance from the SBA, answers a lot of questions about repaying loans that were on the minds of small-business owners. Here are 8 important tips and warnings on PPP loan forgiveness gleaned from the application and new SBA guidance. Hopefully, this information will help prop up the bottom line for a lot of small businesses.

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https://finance.yahoo.com/news/8-tips-warnings-ppp-loan-111908999.html