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By Jennifer Mailhes, CPA – Shareholder, Business Advisory Group

Speculation is swirling that the Small Business Administration (SBA) will rescind its requirement for Paycheck Protection Program (PPP) borrowers with loans greater than $2 million to complete a loan necessity questionnaire.

Since November 2020, the SBA has required Form 3509, Loan Necessity Questionnaire (For-profit borrowers) and Form 3510, Loan Necessity Questionnaire (Non-profit borrowers) for borrowers requesting PPP loan forgiveness of $2 million or more. The questionnaires, designed to help certify the need for the loan, have overwhelmed PPP borrowers with a significant amount of documentation required.

As of today, the SBA has not published any official guidance on this. The speculation was sparked by an announcement the Associated General Contractors of America made. It recently indicated it “has just learned” the SBA intends to withdraw the “Loan Necessity Questionnaire.” The announcement also stated: “At this point, AGC of America does not have any additional information but does expect more information to be forthcoming.”

Without formal guidance from the SBA, borrowers should still complete the questionnaires as requested and maintain all required documentation in the event of an audit. Typically, borrowers are given only 10 days to submit the completed form, along with supporting documentation, to the lender.

Doeren Mayhew recommends borrowers discuss the necessary documentation and questionnaire requirements with their lender. Should you need help compiling your financial documentation, contact our team of PPP advisors today.