CUSO Talk with Phil Love: PPP Loan Forgiveness
by Phil Love, Pactola President/CEO
CAP Senior Member

Late Friday, May 15, the SBA released the Paycheck Protection Program Loan Forgiveness Application. While the original application for the PPP was only 2 pages, the PPP Loan Forgiveness Application is a whopping 11 pages! It proves again there is no such thing as free money or a free lunch!

The application has four sections: (1) PPP Loan Forgiveness Calculation Form, (2) PPP Schedule A, (3) PPP Schedule A Worksheet, and (4) the PPP Demographic Information Form. All borrowers have to complete and submit parts 1 and 2 to their lender along with supporting documents from the form.

Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. There is a grace provision for an employer who attempts to rehire an employee at the same wage level, but the employee rejects the offer. Forgiveness will be reduced if the full-time equivalent employees are reduced. 

The form has several measures to “ease” compliance burdens and to simplify the process for borrowers including the following:

  • Options to calculate payroll costs using an alternative payroll covered period that aligns with the borrower’s regular payroll cycles;
  • Can include eligible payroll and non-payroll expenses paid or incurred during the eight-week period after receiving their PPP loan;
  • Detailed instructions on how to perform the calculations required by the CARES Act for ratifying loan forgiveness amounts;
  • Explanation of statutory exemptions from loan forgiveness reduction based on rehiring by June 30, 2020; and
  • Addition of a new exemption form the loan forgiveness reduction for employers who have made a written offer to rehire employees but whose offer was denied. 

Find the SBA Form 3508 PPP Loan Forgiveness Application here.  

This is one of the next steps in our workload for the PPP loan management. We are finding the applications are slowing down to a trickle compared to the volume that we were working with before. 

Other PPP management items to look for are the detailed instructions on completing the Colson 1502 or any modification thereof in actually reporting these to the SBA for production and payment purposes. This deadline has been pushed back and as I write this; I do not know of any final instructions on this reporting. 

If you have questions regarding the PPP loans or need assistance, please contact us at Pactola. 


Pactola is a CUAD CAP Senior Member and a subsidiary of Midwest Business Solutions. We are a Credit Union Service Organization that is dedicated to commercial and agricultural lending and serving multiple credit unions and banks throughout the United States with our services. We help our partners increase their earning assets and profitability. By doing so, we help them become a relevant financial force in their community increasing social good through helping businesses and farmers. Visit our website to learn more. You can contact Phil Love, Pactola CEO at or 605.223.5154.


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