Did your organization receive a Paycheck Protection Program (PPP) loan of $2,000,000 or more? You are now required to complete a loan necessity questionnaire per a recent article from the Journal of Accountancy. The questionnaires are being sent directly by the Small Business Administration (SBA) to lenders to distribute to borrowers. The SBA will utilize the questionnaires to evaluate that borrowers’ economy uncertainty is what necessitated their loan application. The applicable form for non-profits is SBA Form 3510, Paycheck Protection Program Loan Necessity Questionnaire (Non-Profit Borrowers). You can preview the form here.
Upon receipt of the questionnaire from your lender, you will be given 10 business days to return the completed form and required supporting documents to the lender. Lenders are not required to verify or validate any of the borrower’s responses or supporting documents on the loan necessity questionnaires, according to the SBA. At this time, it is not clear if the 10-day deadline will be extended, but the SBA is expected to release more guidance. We recommend you view this form and begin gathering the required documentation needed as soon as possible given the short turn-around time
We also recommend that you submit contemporaneous records that explain your organization’s situation and thought process at the time you applied for a PPP loan. Like many organizations in your situation, those records will document your uncertainty regarding the length and severity of the lockdowns impacts on your operations.
If you have any questions regarding PPP loan forgiveness for your organization, please contact us.