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Paycheck Protection Program

Paycheck Protection Program (PPP) Loan Forgiveness Application

The Small Business Administration (SBA) has issued three applications for loan forgiveness forms: Form 3508S, Form 3508EZ and Form 3508. These applications are eligible for submission 8 or 24 weeks after a borrower has received PPP loan proceeds prior to 6/5/20. Disbursements occurring on or after 6/5/20 are eligible for submission 24 weeks after a borrower has received PPP loan proceeds; however, if all PPP loan proceeds are used accordingly, borrowers may apply for forgiveness at any time up to the end of the 24 week period.
 

SBA Streamlines  PPP Forgiveness for Loans of $50,000 and Under

Form 3508S (for loans under $50,000)

The agencies released a two-page Form 3508S application, a three-page instruction sheet, and an interim final rule on the streamlined forgiveness process, which they said will allow lenders to process forgiveness applications more swiftly.

Under the simplified process, borrowers with loans of less than $50,000 are exempt from reductions in the forgiveness amount based on reductions in full-time equivalent employees, salary, or wages.

While these borrowers need not make those calculations or show they qualify for a safe harbor, they still must submit documentation to lenders supporting the amounts they paid for payroll costs or other forgivable expenses.

 

Forgiveness for Loans Greater than $50,000

Borrowers can apply for forgiveness of their PPP loan using SBA Form 3508EZ, if they can check at least one of the three items below:
 
  • The Borrower is a self-employed individual, independent contractor, or sole proprietor who had no employees at the time of the PPP loan application and did not include any employee salaries in the computation of average monthly payroll in the Borrower Application Form (SBA Form 2483).
  • The Borrower did not reduce annual salary or hourly wages of any employee by more than 25 percent during the Covered Period or the Alternative Payroll Covered Period compared to the period between January 1, 2020 and March 31, 2020 (for purposes of this statement, “employees” means only those employees that did not receive, during any single period during 2019, wages or salary at an annualized rate of pay in an amount more than $100,000); AND The Borrower did not reduce the number of employees or the average paid hours of employees between January 1, 2020 and the end of the Covered Period. (Ignore reductions that arose from an inability to rehire individuals who were employees on February 15, 2020 if the Borrower was unable to hire similarly qualified employees for unfilled positions on or before December 31, 2020. Also ignore reductions in an employee’s hours that the Borrower offered to restore and the employee refused. See 85 FR 33004, 33007 (June 1, 2020) for more details.
  • The Borrower did not reduce annual salary or hourly wages of any employee by more than 25 percent during the Covered Period or the Alternative Payroll Covered Period compared to the period between January 1, 2020 and March 31, 2020 (for purposes of this statement, “employees” means only those employees that did not receive, during any single period during 2019, wages or salary at an annualized rate of pay in an amount more than $100,000); AND The Borrower was unable to operate during the Covered Period at the same level of business activity as before February 15, 2020, due to compliance with requirements established or guidance issued between March 1, 2020 and December 31, 2020 by the Secretary of Health and Human Services, the Director of the Centers for Disease Control and Prevention, or the Occupational Safety and Health Administration, related to the maintenance of standards of sanitation, social distancing, or any other work or customer safety requirement related to COVID-19.
Borrowers who are unable to check one of the items above must apply for forgiveness of their PPP loan using SBA Form 3508.
 
* In order to ensure proper loan forgiveness, please submit only COMPLETE packages following the SBA's required guidelines.
 
Required for submission of a PPP Forgiveness Application:
  1. SBA Form 3508S, SBA Form 3508EZ OR SBA Form 3508 (with attached Schedule A)
  2. Documentation Checklist

Instructions on submitting Forgiveness Applications via our portal:
  1. Click on the "Business" tab and go to "Extra Services"
  2. Scroll down to "Secure File Delivery"
  3. Click on "Secure Upload"
  4. Click on "PPP Forgiveness 2020"
  5. Fill in your information and attach your documents
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