Since last fall, the Small Business Administration (SBA) has required Paycheck Protection Program (PPP) borrowers with loans of $2 million and above to file a Form 3509 PPP Loan Necessity Questionnaire with their loan forgiveness applications. On June 28, 2021, the Office of Management and Budget withdrew its approval for Form 3509. This action, which directly benefits several hundred dealers with PPP loans of this size, in part resulted from the comments NADA filed in November 2020 and March 2021 urging OMB to withdraw or significantly modify Form 3509.
Many, if not most, dealer PPP borrowers have had their loans forgiven, with the remainder focused on the PPP loan forgiveness process. After PPP lenders review forgiveness applications initially, they provide recommendations to SBA for final decision. Note: PPP borrowers that fail to file for forgiveness within 10 months after the end of their covered period must begin repaying their loans. For more information on loan forgiveness, see the NADA Coronavirus Hub.
In addition to PPP loan forgiveness, dealers are encouraged to review the potential availability of employee retention tax credits (ERTCs) with their legal and financial advisors. An NADA webinar covering the ERTC in some detail is available here.
Please direct any questions to [email protected].