How can I document my draws as a self-employed person for PPP Loan Forgiveness?

M.D. asked 2 months ago
One client provides e-deposits into my personal checking account on a bi-weekly basis and another mails a paper check based on my invoices. Both issued the IRS 1099-MISC for 2019. I have a Business Savings Account that I identified for receipt of the PPP Loan anticipating that I could easily identify the PPP dollars from other income sources with the intent to make draws over the 8-week period of eligibility and strictly (100%) for (personal) payroll expenses.

What would I subsequently use as documentation to request and receive loan forgiveness?
1 Answer
Riia O’Donnell replied 1 month ago
So, M.D., I'm assuming that the client deposits you referred to were pre-pandemic routine payments, you are self-employed, and the PPP loan you've taken is to continue your payroll throughout the 8-week period the loans will cover.

So far, you've done everything right, as far as I can see. Assuming you've estimated the amount you would normally have received against the amount you borrowed for the loan (you say you'll fulfill 100% of the use to payroll), when it comes time to request the loan be converted to a grant you'll want to have ready documents that support what you normally would have been paid by each client (bank statements that show past, regular deposits from each) over a period of time before shutdowns.

The government has created a new form with instructions on how to request the conversion, with more detailed information, but assuming you're going 100% payroll, you should be able to easily make the application.

Find the form here:
https://home.treasury.gov/system/files/136/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf

Your local SBA office can help with any questions on the form and they would be where you'd submit it.