PPP Loan Forgiveness – Help Is Here May 15, 2020

Nonprofits that have received loans from the Paycheck Protection Program (PPP) have questions about how the loan forgiveness process will work — especially in light of new changes that came online as the result of the recent PPP Flexibility Act. That’s why we are pleased to share some nonprofit-focused PPP resources in partnership with Fiscal Management Associates (FMA), a national consulting firm specializing in nonprofit financial management.

Live Clinics

FMA is launching a new clinic: “Managing Your Paycheck Protection Program Loan & Forgiveness 202.” In this session, FMA will share detailed guidance on what organizations can and cannot spend the PPP funds on and what will be eligible for forgiveness, how the forgiveness process will work, and how organizations can estimate their forgiveness amount. In addition, FMA will share highlights and implications of the PPP Flexibility Act, which recently went into effect, including sharing tips for nonprofits on the choices they need to navigate as they aim to maximize forgiveness in the weeks and months ahead. Space is limited; please register for one of these clinics:

  • Register for June 16 at 3 PM CST
  • Register for June 18 at 2 PM CST
  • Register for June 25 at 1 PM CST – Intended for organizations with budget sizes of less than $2 million

These clinics are made possible with funding from the John D. and Catherine T. MacArthur Foundation and in partnership with the following funders: Grand Victoria FoundationHealthy Communities FoundationIllinois Children’s Healthcare FoundationJPMorgan Chase FoundationLloyd A. Fry FoundationPaul M. Angell Family FoundationPierce Family Foundation, and Polk Bros. Foundation.

On-Demand Resources

FMA’s PPP Toolbox includes regularly updated guidance, FAQs, a loan forgiveness estimator, revenue scenario planning tools, cash flow projection templates and tutorials, webinars, and more.

Recent Changes to PPP Loans

The PPP Flexibility Act, enacted June 5, may make additional organizations eligible or interested in this type of financing. Here are some highlights of the changes:

  • Expands period to use the funds from 8 weeks to 24 weeks; borrowers who already have a PPP loan can elect either the 8- or 24-week covered period
  • Extends the time to use funds for eligible costs through Dec. 31, 2020
  • Lowers the amount that must be used for payroll costs from 75% to 60%
  • Changes the minimum loan term to 5 years
  • Gives borrowers up to 10 months from the end of the covered period to apply for forgiveness
  • Borrowers don’t have to start re-paying any unforgiven amounts until after their forgiveness application is processed by the SBA
  • If a borrower’s FTE employees decline employment in the covered period, they can avoid proportional reduction in forgiveness if:
    • They have employees leave and can’t replace them with similarly qualified employees.
    • The organization is unable to return to the same level of business activity that existed before 2/15/2020 due to complying with regulatory guidance from federal agencies related to sanitation, social distancing and other COVID-19-related safety measures.


Need more help?

We hope these resources are helpful. If you have any questions or need further assistance with PPP or related matters, please feel free to contact FMA at fmacares@fmaonline.net or IFF’s dedicated PPP staff at p3@iff.org.

Categories: Archives

Tags: :