SBA PPP Direct Forgiveness Portal: Complete Step-by-Step Guide

If you're one of the millions of small business owners with a PPP loan of $150,000 or less, the SBA's Direct Forgiveness Portal can save you significant time and frustration. Instead of waiting weeks for your lender to process your forgiveness application, you can go directly to the SBA and complete the entire process in as little as 15 minutes.

But navigating government portals can be intimidating, and mistakes can delay your forgiveness or trigger additional scrutiny. This guide walks you through exactly how to use the SBA PPP Direct Forgiveness Portal, what documents you'll need, and common pitfalls to avoid.

What Is the PPP Direct Forgiveness Portal?

The SBA launched the PPP Direct Forgiveness Portal on July 28, 2021, to streamline the forgiveness application process. Instead of working through your lender as an intermediary, eligible borrowers can submit their forgiveness application directly to the SBA.

The portal was specifically designed for the 93% of PPP borrowers with loans of $150,000 or less—the vast majority of small business loans. By creating a direct channel to the SBA, the portal eliminates the delays that can occur when applications sit in lender processing queues.

As of March 2024, the SBA expanded access so that all PPP borrowers can now use the direct forgiveness portal, regardless of loan size or which lender originated the loan.

Who Can Use the Direct Forgiveness Portal?

You're eligible to use the portal if you meet ALL of these requirements:

✅ Haven't already applied through your lender - If you've already submitted a forgiveness application to your lender, you must continue that process ✅ Your lender has opted into the portal - Most lenders have, but verify first ✅ Your loan is $150,000 or under (expanded to all borrowers as of March 2024) ✅ You agree with your COVID Revenue Reduction Score - For second-draw loans ✅ You can validate your identity - The portal requires two-factor authentication ✅ Your previous submission hasn't been rejected - If rejected, work with your lender

If you're unsure whether you're eligible, you can start the registration process at directforgiveness.sba.gov—the system will let you know if you don't qualify.

What You'll Need Before You Start

Gather these documents and information before beginning your application. Having everything ready makes the process much faster:

Required Identification Information

• EIN, SSN, or ITIN used on your PPP application
• SBA loan number (found on your PPP loan documents)
• Business NAICS code (from your original application)
• US-based mobile phone number for two-factor authentication

Loan and Financial Information

• Covered period dates (8-week or 24-week period)
• 2019 and 2020 gross receipts
• Payroll amount spent from PPP loan proceeds
• Employee counts at loan application and forgiveness request
• Requested forgiveness amount

Supporting Documentation (if required)

• Payroll reports or tax forms (Form 941, state quarterly reports)
• Bank statements showing payroll payments
• Payment receipts for covered non-payroll costs (rent, utilities, mortgage interest)
• FTE calculations and documentation

Pro tip: Take digital photos or scans of all documents before you start. The portal requires uploads under 35MB and doesn't accept encrypted files.

Step-by-Step: Using the Direct Forgiveness Portal

Step 1: Register for Portal Access

1. Go to directforgiveness.sba.gov
2. Click "Register" to create a new account
3. Enter your business EIN/SSN and PPP loan number
4. Create a username and strong password
5. Provide your email address and mobile phone number

You'll receive two separate emails:

• One to verify your email address
• One to grant full access to the portal

Check your spam folder if emails don't arrive within a few minutes.

Step 2: Complete Two-Factor Authentication

Every time you log in, you'll need to complete two-factor authentication:

1. Enter your username and password
2. Receive a verification code via text message (to your US mobile number)
3. Enter the code within the time limit

This security measure protects your sensitive business information and PPP loan data.

Step 3: Verify Your Loan Information

The portal will display your basic loan information from the SBA database:

• Loan number
• Lender name
• Loan amount
• Loan disbursement date

Carefully review this information. If anything is incorrect, you may need to contact your lender before proceeding.

Step 4: Select Your Forgiveness Form

The portal will present the appropriate SBA forgiveness form based on your loan amount and circumstances:

• Form 3508S - For loans of $50,000 or less (simplest form)
• Form 3508EZ - For loans between $50,000 and $150,000 meeting certain criteria
• Form 3508 - Standard form for all other loans

The portal automatically determines which form you should use. The questions you'll answer correspond directly to whichever form applies to you.

Step 5: Enter Your Covered Period

Your covered period is either 8 or 24 weeks, starting from your loan disbursement date. You chose this when you received the loan, but you can verify it in your loan documents.

Most borrowers chose the 24-week option because it provided more flexibility in meeting the requirements.

Step 6: Report Payroll Costs

This is the most critical section, as at least 60% of your forgiven amount must come from payroll costs.

Enter:

• Total payroll costs during the covered period
• Number of FTE employees at time of loan application
• Number of FTE employees at time of forgiveness request
• Any salary/wage reductions exceeding 25%

For loans of $50,000 or less (Form 3508S), you can skip detailed FTE and salary calculations—a major time saver.

Step 7: Report Non-Payroll Costs

Enter any covered non-payroll expenses:

• Business mortgage interest payments
• Business rent or lease payments
• Covered utility payments
• Covered operations expenditures
• Covered property damage costs
• Covered supplier costs
• Covered worker protection expenditures

Remember: Non-payroll costs can't exceed 40% of your total forgiveness amount.

Step 8: Calculate Requested Forgiveness Amount

The portal automatically calculates your forgiveness amount based on the information you've entered. Review this carefully:

• Does it match what you expected?
• Did you include all eligible expenses?
• Are your FTE and salary calculations correct?

You can edit previous sections if you need to make corrections.

Step 9: Upload Supporting Documentation

The portal will specify which documents are required based on your loan amount and answers:

For loans under $50,000: Generally minimal documentation required

For loans between $50,000 and $150,000:

• Payroll documentation
• Bank statements
• Payment receipts for non-payroll costs

File upload requirements:

• Maximum 35MB per file
• No encrypted files accepted
• Use MS Edge or Google Chrome for best results
• Can upload multiple files using "Add Additional Documents"

Step 10: Review and Submit

Before final submission:

• Review every section for accuracy
• Verify all required documents are attached
• Read the certification statements carefully
• Electronically sign the application

Once submitted, you'll receive a confirmation email with your submission details.

Understanding the COVID Revenue Reduction Score

For second-draw PPP loans, borrowers had to prove at least a 25% revenue reduction. The Direct Forgiveness Portal includes a COVID Revenue Reduction Score tool that can simplify this requirement.

The tool generates an alternative score based on:

• Your business location
• Your industry (NAICS code)
• Your business size

If the system calculates that businesses like yours were significantly affected by COVID-19, you may not need to provide manual documentation proving the 25% reduction.

However, if you disagree with the score, you can still provide your own documentation to prove the required revenue reduction.

Tracking Your Application Status

After submission, you can log back into the portal to check your application status:

• Pending Review: SBA is reviewing your application
• Additional Information Requested: SBA needs more documentation
• Approved: Your forgiveness has been approved
• Denied: Your application was denied (you'll receive details why)

The SBA aims to review applications within 90 days, but many are processed much faster—especially for smaller loans with complete documentation.

Common Mistakes to Avoid

Mistake #1: Incomplete Documentation

Even on the simplified forms, the SBA can request additional documentation. Upload clear, complete documents the first time to avoid delays.

Mistake #2: Incorrect Covered Period Dates

Using the wrong start and end dates can throw off all your calculations. Double-check your loan disbursement date and whether you selected 8 or 24 weeks.

Mistake #3: Miscalculating FTE Counts

FTE calculations can be tricky, especially for part-time employees. Take your time on this section or consult with your accountant if unsure.

Mistake #4: Exceeding the 40% Non-Payroll Limit

If more than 40% of your forgiveness request is for non-payroll costs, your forgiveness amount will be reduced. Verify your ratio before submitting.

Mistake #5: Submitting Encrypted or Oversized Files

The portal automatically rejects encrypted files and files over 35MB. Check your file properties before uploading.

Mistake #6: Not Reading Certification Statements

The certification statements include important legal attestations. Read them carefully—you're signing under penalty of perjury that your application is accurate.

What Happens After You Submit?

Once your application is submitted:

1. SBA Reviews Your Application - Typically within 90 days
2. SBA May Request Additional Information - You'll be notified via email and in the portal
3. SBA Issues Decision - Approval or denial with explanation
4. Lender Receives Forgiveness Payment - If approved, the SBA pays your lender
5. Your Loan Balance Is Reduced - The forgiven amount is wiped out

If your application is approved, the forgiven amount is removed from your loan balance, and you're only responsible for repaying any unforgiven portion (if applicable).

If your application is denied or partially approved, you have 30 days to appeal the decision. During the appeal process, you can defer loan payments until the appeal is resolved.

Tips for a Smooth Application Process

Use Recommended Browsers

The portal works best with MS Edge or Google Chrome. Some users report issues with Safari or Firefox.

Save Your Progress

The portal allows you to save your application and return later. Don't feel pressured to complete it in one session.

Keep Copies of Everything

Screenshot each page and save copies of all uploaded documents. This creates a complete record of what you submitted.

Watch for SBA Emails

Check your email regularly after submission. The SBA will use email to communicate about your application status and any document requests.

Consider Professional Help for Complex Situations

If you have complicated payroll situations, multiple owners taking compensation, or other unique circumstances, consider having an accountant review your application before submission.

Managing Your Financial Records Beyond PPP

Whether you're applying for PPP forgiveness or managing day-to-day business finances, maintaining organized, accurate financial records is essential. Beancount.io offers plain-text accounting that provides complete transparency and version control for your financial data—perfect for meeting compliance requirements while keeping your records accessible and audit-ready. Get started for free and take control of your business finances.