Yesterday the AICPA was joined and supported by many small business advocates in making a statement and plea to The Department of Treasury (Treasury) and the Small Business Administration (SBA) for “clear and consistent guidance” on the Paycheck Protection Program (PPP.) The uncertainty and threat of penalties as a borrower of these funds has caused many businesses, that the loan was intended to help, to rethink availing themselves of the funds they need to keep or bring back workers. Just one day before the May 14, 2020 deadline to return the funds with “no questions asked,” the small business community is still in the dark regarding guidance on loan forgiveness and necessity of funds from Treasury and the SBA. Below is the AICPA’s response to this devastating silence:
AICPA, NFIB, and Others Say SBA Must Issue More Guidance on PPP Loan Forgiveness
WASHINGTON, DC, May 12, 2020 – Today the American Institute of CPAs (AICPA), National Federation of Independent Business (NFIB), the S Corporation Association (S-CORP) and four other small business advocates issued the following statement in response to the lack of clear and consistent guidance from the Department of the Treasury’s and Small Business Administration’s (SBA) on the Paycheck Protection Program (PPP). The statement is also supported by the Associated Builders and Contractors, National Electrical Contractors Association, American Council of Engineering Companies and the National Association of Wholesaler-Distributors. Together, these groups represent the voice of several million small businesses.
“The Department of the Treasury and SBA launched the Paycheck Protection Program (PPP) to help small businesses stay open and keep their workers employed.
This relief is needed now more than ever. However, changing SBA guidance is causing many small businesses to rethink their participation in the Program. Small businesses need consistency and certainty, and applicants need to know that they will be held to the same guidance that was in place at the time the business applied for a loan.
Some deserving businesses are returning funds or choosing to forego applying due to the uncertainty created by the SBA. As the Wall Street Journal reports, demand for PPP loans has all but dried up in the last week.
This collapse of trust in what ultimately has been a successful program is troublesome and will negatively impact our country’s economic recovery.
The last thing we need is for deserving businesses to lay off employees and close their doors because ever-changing rules and the threat of civil penalties scared them away from the PPP. To fix this, the SBA needs to immediately revise its recent guidance to better mirror the PPP’s intent and to issue additional guidance making clear the terms for PPP loan forgiveness.
Meanwhile, policymakers need to remain focused on the PPP’s original purpose — to ensure businesses have the financial resources necessary to keep employees paid while government-mandated stay-at-home orders remain in place.
Our nation’s economy will recover, but it will take time and it will take the hard work of small businesses that are critical to our communities.”
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