SBA To Withdraw Forms 3509/3510

June 2021

BY

Norma ShararaManaging Director, National Tax Office

Joan VinesManaging Director, National Compensation & Benefits Technical Leader

Any Paycheck Protection Program (PPP) borrower that has already received a request for Form 3509 or Form 3510 from its lender should contact that lender for instructions on how to proceed in light of reports that the SBA will withdraw the requirement for these loan necessity questionnaires.

Borrowers who have not yet received a formal request for the loan necessity questionnaire may not receive one.

In a statement dated June 23, Associated General Contractors of America (AGC) President Stephen E. Sandherr said that, after weeks of lawsuit negotiations with the U.S. Department of Justice (DOJ), DOJ had told AGC that SBA intends to withdraw Form 3509.

The SBA’s withdrawal of the loan necessity questionnaires was discussed June 24 on the AICPA's Town Hall webcast. A replay of the webcast is available for free on AICPA TV.

Since November 2020, SBA has required Form 3509, Loan Necessity Questionnaire (for-profit borrowers) and Form 3510, Loan Necessity Questionnaire (nonprofit borrowers) from borrowers requesting PPP loan forgiveness of $2 million or more when aggregated with PPP loans received by affiliates. Form 3509 focused on the “good faith” certification that businesses had to make when applying for a PPP loan, but it asked for significant documentation about how the borrower fared after receiving the loan.

Until the SBA publishes official guidance, caution is advised and requests to complete the questionnaire should not be ignored. Typically, borrowers are given only 10 days to submit the completed form to the lender. Usually, the request for Form 3509/Form 3510 also includes a request for other supporting documents that the borrower was instructed to maintain in its files; that documentation might still be required, even if Form 3509/3510 no longer is.   

The withdrawal of the loan necessity questionnaire in its current form may not change the SBA procedures regarding the audit of all PPP loans of $2 million or more. Therefore, documentation of all aspects of those loans, including necessity, remains essential.