Documentation Required for PPP Forgiveness

05/19/2020 5:16PM

Please bear with this post.  Some things just can’t be easily be changed to plain English, as is the case with the following explanation of documentation required for PPP forgiveness.

Payroll Documentation

Note:  The “Covered Period” for this section is

  • the 8-week period beginning when you received PPP funds OR
  • if you are a biweekly or weekly payer, the 8-week period beginning the first day of your next payroll after you received your PPP funds.
Required documentation of compensation:
  • Payroll reports for your Covered Period.
  • 2Q 2020 941 and SUTA forms.
  • Proof of contributions to employee health insurance and/or retirement plans during your Covered Period.
      • Note:  At this time this includes only payments for “employees” which include S corp owner employees, but does not include self-employed individuals operating a sole-prop/Schedule C business.
      • Note:  This does not include amounts that are withheld from employee checks that you pay on their behalf.
  • The amount of Full Time Equivalent (FTE) employees on the payroll during the following time periods:
      • Note:  Instructions for calculating FTE coming soon.
    • Feb. 15, 2019 – June 30, 2019 OR Jan. 1, 2020 – Feb. 29, 2020, whichever you prefer and you would want the lower figure.
    • Average FTEs during the Covered Period.
    • The amount of FTEs on June 30, 2020 (if you are using the FTE Safe Harbor to avoid FTE forgiveness reduction).

Nonpayroll Documentation (i.e. rent, utilities, mortgage interest)

Note:  The “Covered Period” for this section is

  • the 8-week period beginning when you received PPP funds.
  • Business mortgage interest payments
    • copy of the amortization schedule AND cancelled checks during the Covered Period OR
    • detailed statements for the period Feb 2020 through one month after the end of the Covered Period AND cancelled checks during the Covered Period.
      • NOTE: The term “mortgage” includes your practice loans as long as the obligation is secured by property of the practice (i.e. equipment)
  • Building rent/equipment lease payments
    • copy of the rental agreement AND cancelled checks during the Covered Period OR
    • detailed statements for the period February 2020 through one month after the end of the Covered Period AND cancelled checks during the Covered Period.
      • Note:  Most landlords don’t provide monthly statements so start looking now for your lease.  If you can’t find your copy, request a new one soon!
  • Utilities (electric, gas, water, internet, & phone)
    • detailed statements/invoices for the period February 2020 through the month of the last payment during the Covered Period AND cancelled checks during the Covered Period.

In addition to this documentation required for PPP forgiveness that must be submitted, there is documentation that must be retained by you for a long period of time.  We will provide those details at a later time.