PPP Loan Forgiveness

Resources and Information for PPP Loan Forgiveness

Understanding PPP Loan Forgiveness

Since the inception of the SBA Paycheck Protection Program (PPP), there has been a lot of communication from the Treasury with updates and ongoing clarification to the program. See a previous post on the program overview here.

While the details related to the forgiveness portion may still be evolving, we encourage customers to visit the US Treasury Cares site for the most recent information and to review the information contained in the forgiveness application.

Download PDF of forgiveness application. 

The following information is current as of May 28, 2020.

AMNB Forgiveness Process

In order to make the forgiveness process as smooth as possible for our customers, we will provide you with a secure portal that will guide you through the steps and documentation necessary for completing your application for forgiveness. The basic steps are summarized below.

  1. AMNB sends portal link to customer to complete online form (simpler than SBA 3508 form)
  2. Customer uploads supporting documentation (e.g. payroll files)
  3. Calculator automatically calculates amount of forgiveness (based on input to online form)
  4. AMNB creates the 3508 form and an email is generated for customer to  e-sign
  5. AMNB conducts good faith review of the 3508 form and supporting documents
  6. AMNB sends to SBA (no further guidance issued to date)
  7. Upon SBA approval, the bank has 60 days for forgiveness
Your Relationship Manager will be in touch with you once everything is ready to complete via the online portal. In the meantime, you can review the checklist of items needed for forgiveness below.
 

Eligible Expenses for Forgiveness

As a reminder, the amount of loan forgiveness will be equal to the sum of approved expenses incurred during the covered 8-week period following the loan origination date. Eligible expenses include:
  • Payroll Costs (must be 75% of forgiveness expenses)
  • Interest (not principal) on business debts incurred prior to February 15, 2020
  • Rent
  • Utilities including electricity, gas, water, transportation, telephone ,and internet access.
The amount of forgiveness cannot exceed the original principal amount of the loan. Loan forgiveness is intended to encourage employers to retain employees. Therefore the loan forgiveness amount will be reduced proportionally by the reduction in employees during the covered/alternative covered period.

Loan Forgiveness Checklist

The SBA posted the PPP loan forgiveness application which outlines what is needed for loan forgiveness. For your reference, you can download our simple checklist here which is also copied below:

General Information Needed for PPP Loan Forgiveness Application

  • Business Legal Name, Address, and Contact Information (Same as Borrower Application Form)
  • SBA PPP Loan Number (E- Tran number assigned by SBA)
  • Lender PPP Loan Number (Loan number assigned to PPP loan by Lender)
  • PPP Loan Amount
  • Employees at Time of Loan Application and at Time of Forgiveness
  • PPP Loan Disbursement Date (First date of PPP loan proceeds)
  • EIDL Advance Amount and Application Number (if applicable)
  • Payroll Schedule
  • Covered Period (Same as PPP loan disbursement date)
  • Alternative Payroll Covered Period

FTE Documentation

  • Payroll tax filings reported (Form 941)
  • State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported

Payroll Documentation

  • Bank account statements
  • Payroll tax filings (Form 941)
  • State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported
  • Payment receipts, canceled checks, account statements documenting amount of any employer contributions to employee health insurance, retirement plans, etc.
  • If borrower applied to PPP as a contractor, sole proprietor, or partnership: 2019 1099-MISC forms OR Schedule C OR Schedule K-1 to verify owner compensation replacement

Nonpayroll Documentation

  • Rent: Copy of lease agreement (must be in effect before Feb. 15, 2020); copies of account statements from lessor to show payments
  • Mortgage interest: Lender amortization schedule, receipt of payments and statements (mortgage must be signed before Feb. 15, 2020)
  • Utilities: Utility invoices and account statements showing payments made during eight-week period (must be in service before Feb. 15, 2020) 
Please be sure to let us know if you have any questions with this process. Thanks for your ongoing trust in us.

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