Learn about Paycheck Protection loan forgiveness
UPDATE – May 22, 2020
On Friday, May 15, the SBA and U.S. Treasury released the Paycheck Protection Loan Forgiveness Application. The application provides instructions to borrowers on their responsibilities to obtain loan forgiveness under the program, including required documentation. We’ve included some highlights below, but please refer to the application form and the latest updates from the U.S. Treasury released May 22, 2020, found here, to understand the full parameters as set forth by the SBA so far.
Eligible expenses and required documentation
The application includes detailed information about the expenses eligible for forgiveness and instructions for calculating those expenses.
Based on the parameters set forth by the SBA, we suggest that you gather documentation supporting how your loan proceeds were spent during the covered period on payroll, utilities, mortgage interest and rent including but not limited to:
- Bank account statements or third-party payroll service provider reports
- State and Federal payroll tax filings
- Payment receipts, cancelled checks, or account statements of any employer contributions to employee health insurance and retirement plans included in forgiveness amount request.
- Loan transaction history and copies of cancelled checks related to mortgage interest obligations
- Copy of current lease agreement or lessor statements and cancelled checks demonstrating payment of rent
- Utility account statements and cancelled checks
- Documentation that shows the number of FTE employees you maintained during the historical reference period you choose.
- Nonpayroll expense documentation verifying the existence of obligations prior to February 15, 2020, and receipts, canceled checks, or account statements verifying eligible payments
There is a safe harbor from loan forgiveness reduction for borrowers who are able to rehire previously-displaced employees by June 30, 2020. The SBA also included an exemption from forgiveness reduction for borrowers who make a good-faith, written offer to rehire workers that was declined. Learn more about these measures in the SBA announcement, here.
What happens next
Borrowers should take time to familiarize themselves with the responsibilities the SBA has specified in the application, but please be aware that additional guidance may be released at any time, and all guidance is subject to change.
We expect to launch our digital loan forgiveness application process for uploading documentation, providing required certifications, and signing your application, beginning in mid-June.
When will the application process become available?
Borrowers should generally wait until the end of the covered period for their loan to apply for loan forgiveness.
Based on the timing of your loan funding date, you can expect to receive an email notification from us with a direct link to our online loan forgiveness application platform roughly a week ahead of when we’re officially ready to begin the process for you.