Form 3508, 3508EZ, or 3508S: Which Version Should You Use for PPP Forgiveness?

Small business owners have certainly been through the ringer in 2020. The Paycheck Protection Program (PPP) was a lifeline many business owners were willing to grab, but there were some strings attached. Complicated rules and unanswered questions left many people scrambling.

But now, you’re in the home stretch. You’ve gotten the loan and just need to apply for forgiveness using Form 3508. However, there are three versions of Form 3508 out there. 

Which Form 3508 is the one that you need? 

What is Form 3508?

The PPP provided forgivable loans to businesses impacted by COVID-19. After receiving a PPP loan, borrowers must apply for forgiveness through their lender by filling out the Small Business Administration (SBA) form and providing supporting documents. SBA Form 3508 is the document PPP loan borrowers must complete to request loan forgiveness. The three versions of the form include a regular Form 3508, Form 3508EZ, and 3508S. 

The SBA and Treasury released Form 3508 on May 15, 2020. Many business owners and financial advisors shared concerns about its complexity and rigid rules. 

In response, Congress passed the PPP Flexibility Act of 2020 to make changes to the PPP, prompting the release of a revised Form 3508 on June 16. To make things even easier for eligible borrowers, the SBA and Treasury also released Form 3508EZ. 

But for months, there were still concerns about the forms. So on October 8, the SBA and Treasury released Form 3508S for qualifying borrowers. 

Although the three versions of Form 3508 are different, they all begin by asking for the following business and PPP loan information:

Business legal name Business address DBA or trade name (if applicable) Taxpayer identification number (e.g., EIN) Phone number Primary contact Email address SBA PPP loan number Lender PPP loan number PPP loan amount Disbursement date (when you received the loan) Number of employees at time of loan application Number of employees at time of forgiveness application Economic Injury Disaster Loan (EIDL) advance amount EIDL application number Forgiveness amount Rundown on PPP forgiveness eligibility 

For full PPP forgiveness, you must meet a few requirements. Borrowers must use Forms 3508 to not just request loan forgiveness, but also to determine the amount of forgiveness. 

To get your PPP loan forgiven, you must:

Use it for eligible expenses (60% of the loan for payroll costs and 40% for mortgage interest, rent, and utility costs) Keep your employee full-time equivalent (FTE) levels up Not reduce employee wages by more than 25%

So … which Form 3508 do you need for PPP forgiveness? 

Form 3508 vs. 3508EZ vs. 3508S: What’s the difference?

Form 3508EZ and S are simplified documents for eligible employers and solopreneurs. Unless you qualify to use the EZ or S versions, you must apply with the regular Form 3508. 

The difference between the forms lies in the calculations you need to do. Form 3508 requires the most calculations, Form 3508EZ requires less calculations, and Form 3508S is nearly calculation-free (cue the celebration). 

The form you use depends on certain factors such as:

How much you borrowed Whether you reduced employee salaries and headcount 

Take a look at details about each form as well as their eligibility requirements to determine how you can apply for PPP loan forgiveness.  

Who can use Form 3508?

Any borrower

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