The Small Business Administration (SBA) has released new Paycheck Protection Program (PPP) guidance on procedures that must be followed when a change in ownership occurs. A change in ownership is defined as:
If there is a change of ownership, the PPP borrower remains responsible for:
In addition, there are further required notifications and procedures that must be employed as a result of a change in ownership. Please refer to the full procedural notice if a change in ownership has occurred.
Then a few days later, the SBA added an entry to their FAQ page which states lenders are required to give immediate effect to the statutory extension under the PPP Flexibility Act and should notify borrowers of the change to the deferral period. Formal modification of a promissory note is not required. So what does this mean for borrowers? That depends on where you are in the forgiveness process. If you are unsure about which deferral period applies to you, contact your DGC client service team or your lender.
DGC has a proven process that utilizes our sophisticated model and incorporates our data analytics experience and accounting expertise to maximize PPP Loan forgiveness. If you have questions, please contact a member of your DGC client service team or George Shaw, CPA at 781-937-5125 / firstname.lastname@example.org and Kimberley Train, CPA, ABV at 781-937-5112 / email@example.com. You can also visit DGC's coronavirus web page at dgccpa.com/coronavirus which is frequently updated with new resources to help you deal with the financial impact of the coronavirus on you and your business.