How to Appeal a PPP Forgiveness Denial to OHA: The Process Nobody Explains Properly

Your PPP forgiveness got denied. Now your staring at a letter from the SBA that basicly says you owe back every penny of that loan you thought was going to be forgiven. Maybe with interest. Maybe with penalties.

Heres the thing most people dont realize. This isnt necesarily the end. Theres an appeals process through the SBA Office of Hearings and Appeals - OHA - and it works alot better than you probly think.

At Spodek Law Group, weve helped business owners navigate OHA appeals when everyone told them there situation was hopeless. Todd Spodek and our team understand that these denials often happened becuase of the chaos during COVID, not becuase you did anything wrong. Our mission is making sure legitimate borrowers dont get crushed by a system that made promises it couldnt adminiter properly. Call us at 212-300-5196 becuase that 30-day appeal deadline is absolutly unforgiving and every day you wait is a day you cant get back.

The Critical 30-Day Deadline You Cannot Miss

Before we get into anything else, you need to understand this: you have exactly 30 calendar days to file your OHA appeal from the date of the final SBA loan review decision.

Not 30 business days. Calendar days.

Not 30 days from when you recieved the letter. From the date ON the letter.

Not 30 days from when you finished being upset about it. From the decision date.

If you miss this deadline by even one day, your appeal rights are gone forever. OHA has no authority to extend this deadline. No exceptions for good cause. No "I didnt know." Nothing.

Ive seen business owners lose there appeal rights becuase they spent three weeks researching what to do, then realized they only had a few days left. Ive seen people who didnt get the mail for a week discover there deadline had already passed by the time they read the denial letter.

This is not a deadline to play around with. If youve recieved a forgiveness denial and your reading this article, stop reading and check your dates right now. Seroiusly. Do it now. Then come back.

Understanding Why Forgiveness Gets Denied

OK so now that weve established the urgency, lets talk about why these denials happen in the first place. Understanding the denial reason is essential to building your appeal.

Documentation issues. The most common denial reason. SBA says you didnt provide sufficient documentation of eligable expenses, payroll costs, or other covered uses. Sometimes this is becuase you actualy didnt provide enough. Often its becuase your lender lost it, or SBA lost it, or the documentation requirements were unclear when you submitted.

Eligibility questions. SBA determined you werent eligable for PPP in the first place - maybe questioning weather your business was operating, weather you had employees, weather you met size standards. These denials often involve database errors or misunderstandings about business structure.

Payroll calculation disputes. SBA disagrees with how you calculated your loan amount. Maybe they think you inflated payroll numbers. Maybe they interpret the rules differently then how you applied them. These can be strong appeal cases when you followed contemporaneous SBA guidance.

Duplicate loan issues. SBA thinks you recieved multiple PPP loans improperly, or that you "double-dipped" with EIDL funds for the same expenses. Sometimes these flags are accurate. Often theyre based on confused records or legitimate sequential loans.

Use of funds concerns. SBA believes you didnt spend forgiveness-eligable money on forgiveness-eligable things. But the rules about what counted were genuinly confusing and changed multiple times.

Timing problems. Issues with your covered period, when you submitted for forgiveness, or weather you met various deadlines that honestly kept shifting throughout the program.

What OHA Actually Is (And Why It Matters)

The SBA Office of Hearings and Appeals is an independent body within SBA that reviews agency decisions. And "independent" actualy means something here.

OHA judges are Administrative Law Judges who dont work for the loan processing division. They didnt make the decision to deny your forgiveness. They have no institutional investment in upholding that denial. There job is to apply the law to the facts and reach the correct result.

This matters more than you might think. These judges see SBA mistakes all day long. Theyre familiar with the chaos of COVID-era loan processing. Theyre not shocked when they discover SBA applied the wrong standard or ignored evidence you submitted.

OHA proceedings are entirely written - no oral hearings, no in-person testimony. This actualy helps well-prepared appellants becuase everything depends on what you submit on paper. Theres no intimidation factor from facing government lawyers. Theres no disadvantage from being nervous or inarticulate. If you can document your case effectively in writing, you get a fair shot.

And heres something most people dont know: OHA reviews your case de novo. That means from scratch. Theyre not just checking weather SBA followed procedures. Theyre independently evaluating weather you qualify for forgiveness based on all the evidence.

The Bank vs SBA Problem

Heres a pattern we see constantly. Your forgiveness gets denied, but the real problem was your lender.

Remember how PPP worked? You applied through a bank or other PPP lender, not directly to SBA. That lender processed your application, submitted your forgiveness request, and acted as intermediary throughout.

Some lenders did this well. Many did it terribly.

We see cases where the bank submitted incomplete documentation even though the borrower provided everything. Cases where the bank missed SBA deadlines and the borrower got blamed. Cases where the banks own portal glitched and lost uploads. Cases where bank representatives gave wrong advice that borrowers relied on.

When SBA denies forgiveness based on missing documentation, they dont investigate weather the bank lost it. They just deny.

An OHA appeal can surface these lender problems. We can document what you actualy provided. We can show communications where you followed bank instructions. We can demonstrate that the denial resulted from lender failure, not borrower fraud.

Sometimes when we present this evidence, the bank suddenly discovers they DO have your documents after all. Funny how that works.

Building Your Appeal: The Essential Elements

OK so youve decided to appeal. What actualy goes into an OHA submission?

Your petition. This is a written document explaining who you are, what decision your appealing, why the decision was wrong, and what you want OHA to do. It needs to be clear, organized, and focused on legal arguments rather then emotional grievances.

The record below. Everything that was submitted to SBA and your lender during the forgiveness process. Every document you provided. Every communication. Every response. OHA needs to see what SBA was working with.

New evidence. Heres something powerful - you can submit documentation to OHA that wasnt in front of SBA. Maybe you have records that werent requested. Maybe you have contemporaneous emails showing your intent. Maybe you have expert declarations about industry practices. OHA will consider evidence that wasnt previously submitted.

Legal argument. This is where most self-represented appellants fall short. Its not enough to say "this isnt fair" or "I did everything right." You need to explain which SBA regulations or guidance support your position, why the denial was legally incorrect, and what standard OHA should apply.

Proposed findings. Tell OHA exactly what you want them to find and why. Make it easy for the judge to rule in your favor by laying out the logical path.

Common Winning Arguments

Based on our experience with PPP appeals, here are arguments that actualy work:

Contemporaneous guidance. You followed SBA guidance that was in effect when you applied or when you submitted for forgiveness. Even if SBA later changed there interpretation, you relied on what they said at the time. OHA has reversed denials where SBA retroactivly applied new standards.

Documentation was provided. You can prove you actually submitted the documents SBA claims are missing. Confirmation emails. Upload screenshots. Correspondence with your lender. This converts a documentation denial into an SBA or lender error.

Reasonable calculation methodology. Your payroll calculations followed a reasonable interpretation of the rules. Maybe SBA disagrees with your methodology, but you can show it was consistent with how the rules were understood at the time.

Eligibility was proper. For eligibility denials, you can demonstrate your business met all requirements. Maybe there was confusion about your corporate structure. Maybe SBA's databases had errors. Maybe someone with a similar name is ineligable but your not.

Technical compliance vs substance. SBA denied on technical grounds but you substantially complied with program requirements. The spirit of the law supports forgiveness even if there are minor paperwork issues.

Changed circumstances. Sometimes forgiveness gets denied based on outdated information or situations that have since been clarified. OHA can consider the full picture.