For those businesses who have received a PPP loan the following is an update regarding your loan:
The SBA has issued numerous rules regarding who was eligible for those loans and whether those loans were “necessary” for your business.
Over the past couple of weeks the SBA has issued conflicting guidance concerning what the term “necessary” meant and how they would proceed against a business who received a loan that was not “deemed necessary”.
On May 13, 2020 the SBA has now issued safe harbor guidance. Basically, if your business received a loan that was less than $2,000,000.00 (together with any affiliated entities); then that loan is presumed necessary.
If you received a loan that was more than $2,000,000.00 then you will be audited and the necessity question will be examined. If your loan is determined not to be necessary; then if you pay it back to the SBA, then the SBA will not pursue any administrative enforcement or refer you to any other government agency (i.e., criminal referral).
If you are unsure as to what to do, please give us a call and we can assist you with any PPP loan issue that you may have.
