SBA PPP Loan Forgiveness Application Form

The SBA released the following form to be used to apply for PPP loan forgiveness:

3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf (293.8 KB)

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It’s interesting to note that the forgiveness is the lesser of the following three items (Lines 8-10 on the above referenced form):

  1. FTE Reduction Quotient X (Total Payroll Cost - ProRated earnings for any individual over $100k per year);
  2. Total PPP Loan Amount;
  3. 75% of Payroll Cost during 56-day period.

Don’t bend over backwards too, too far in trying to get your loan forgiven. The last thing you should do is sabotage the long-term health of your business in your attempt to maximize PPP loan forgiveness . Instead of going through contortions to potentially achieve 100% loan forgiveness, invest your time contemplating your business strategy, forecasting different scenarios, and having a plan for how to grow out of our challenging economy.


Hisotrically, the SBA has used 30 hours per week as “Full Time”. It appears that on the Forgiveness Loan Application linked above, they are now wanting employers to use 40 hours:

For each employee, enter the average number of hours paid per week, divide by 40, and round the total to the nearest tenth. The maximum for each employee is capped at 1.0. A simplified method that assigns a 1.0 for employees who work 40 hours or more per week and 0.5 for employees who work fewer hours may be used at the election of the Borrower.

According to the latest information, is the Group Health Insurance portion for owner-employees open for forgiveness ?
It also looks like the maximum amount allowed to any one earning over 100,000 is limited to $15,385(and not 8333.33 x 2)

That is going to depend on you corporate filing status as well as how your health insurance benefits are set up.

I am a solo practitioner… any advice

Unfortunately, even for a solo practitioner, there are many variables that your accountant is best suited to assist with. Further, after having reviewed the PPP forgiveness application, there are many uncertainties that I suspect the SBA and Treasury Department will providing guidance on over the coming few weeks (and months).

My suggestion would be to set this aside for a few weeks and see if the SBA issues revised forms and how the guidance may clarify issues. Even if you reach out to your accountant, the only thing they could provide is a “best guess” as of this week…

For those who will be completing their PPP loan forgiveness application, my (small town community) banker advised that it is “easier” to approach the form backwards since as he put it, it is a form that is based on worksheet which is based on worksheet which is based on a worksheet" :roll_eyes: :scream:

In case you didn’t attend, this was a great webinar yesterday. Blumshapiro is coming out with a revised spreadsheet covering the new forgiveness application form.


How should PRN (temporary basically) staff be treated when calculating if pay was reduced more than 25%? I may have one person work 1 day in the month or 10 days depending on staffing. If I have to compare when they worked 10 days with the 1 day, we will lose. This does not make sense. My payroll didn’t go down, because the position was filled by either the regular staff member or another PRN. Also, if I have a PRN nurse that has a full time position at the hospital and doesn’t have time to even be on our schedule to call if needed, should they get a letter that says we are offering to have them on our schedule and document they aren’t available? Thanks.

We have the same situation with a contingent nurse that happened to work more during the 1st Q this year than she likely will during our PPP. The good news is that the PPP forgiveness application seems to solve this. If you follow the PPP forgiveness calculation for hourly employees, they are basing the 75% on hourly rate not the actual earnings during the 1st Q compared to during the PPP. In my head that can’t be right, but I have talked to our accountant about it and she agrees that based on how they have written it and their calculations. Therefore, as long as you pay her something during the PPP period and don’t change her hourly rate, you will have maintained her hourly wage. For specific language on this, look at the PPP Forgiveness Application, page 7.

From the FTE perspective, their new guidance saying we can use a simplified calculation for FTE was a game changer for us. As long as your prn nurse worked at least 1 hour (ours virtually attended a few of our weekly Zoom meetings), they are considered 0.5 FTE, which they would have been for the 1Q as well.

All of that being considered, it still wouldn’t hurt to get a letter offering them hours or a letter from them asking to temporarily stop working given their demand at the hospital so they can be completely removed as an FTE using the FTE safe harbor.