We're here to help with the PPP Forgiveness Application
Evergreen Credit Union has created an online forgiveness application for borrowers to complete which includes recent changes to the use and timing of PPP loan proceeds. Please read all of the content below, as it answers most questions about the process.
Congress is still considering additional changes to the forgiveness process that may simplify applications for loans under $150,000. Although this is not guaranteed to happen, PPP borrowers may choose to wait until more information is known. Additionally, all borrowers have up to 10 months from the completion of their grace period (“Covered Period”) to apply for forgiveness. Please note that interest accrues during the time between the disbursement of the loan and the time the SBA has conveyed to Evergreen the final amount of the forgiveness. The borrower is responsible for paying the accrued interest on any amount of the loan that is not forgiven.
Loan Forgiveness Details
- Forgiveness can be over 24 weeks (up from 8 weeks)
- Requires 60% of loan used towards payroll (down from 75%)
- Eligible Payroll Figures:
- Wages and Salaries
- Reported Tips, when applicable
- Employer-paid Health and other similar Benefits
- Employer-paid contributions to Retirement Accounts
- Employer-paid State Payroll Taxes
- NOT ELIGIBLE – Employer-paid Federal Payroll Taxes (Common Error)
- Payroll costs per employee is capped at $100,000 (annualized). Other eligible payroll costs (e.g. benefits, state taxes, etc.) are not capped
- If any repayment needed, now over 5 years (up from 2 years)
- Employee rehire deadline was changed to year-end
- Up to 40% can be used for rent, mortgage interest expense, and utility payments. The amount of loan forgiveness may be up to the full principal amount of the loan plus accrued interest
- Other technical changes; please see SBA website for details
What do I need to document?
- For Schedule C and Schedule F filers, you must provide a copy of the schedule filed for 2019
- Bank account statements or 3rd-party payroll reports documenting the compensation paid to employees
- Tax forms (or equivalent 3rd-party payroll reports) for periods that overlap with either the Covered Period or the Alternative Payroll Covered Period:
- Payroll tax filings reports to the IRS – typically Form 941; and
- State quarterly business and individual employee wage reports along with unemployment insurance tax filings
- Payment receipts, cancelled checks or account statements documenting the amount of employer contributions to employee health insurance and retirement plans
If you've used loan proceeds for rent, interest payments or utilities, you'll need:
- Business interest payments: Copy of loan statements from February 2020 and the months of the Covered Period through one month after the end of the Covered Period verifying interest amounts and eligible payments; unsecured debt is not eligible
- Business rent or lease payments: Copy of current lease agreement along with receipts or cancelled checks verifying eligible payments from the Covered Period
- Business utility payments: Copy of invoices from February 2020 and those paid during the Covered Period and receipts, cancelled checks or account statements verifying those eligible payments
Should the amount of eligible payroll expenses meet or exceed your loan amount, you may not need to provide any additional non-payroll expense documentation.
The Forgiveness Application must reflect the full covered period (either 8 weeks or 24 weeks) for your PPP Loan, even if you are applying before the covered period expires.
Apply Here for Loan Forgiveness
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Two Steps to Loan Forgiveness:
- Complete the PPP Forgiveness Application Here - Important: Borrowers must use the same email used on their original PPP loan application.
- Upload your supporting documentation. We must have the supporting documentation in order to process your application.
When will my PPP Loan Be Forgiven?
Once Evergreen Credit Union receives the borrower's completed forgiveness application with all required supporting documentation, we will review the information for accuracy and completeness and submit to the SBA within 60 days. The SBA will render a decision back to Evergreen within 90 days of receiving the forgiveness application from us. Although not guaranteed, it’s possible that a forgiveness decision could be rendered sooner than those timeframes depending on the backlog of forgiveness applications received by Evergreen Credit Union and by the SBA. Your patience during this process is greatly appreciated. While some of the process is within our control, much of the process is still controlled by the Small Business Administration.
If a loan forgiveness application is submitted within ten months of the completion of the Covered Period, the borrower is not required to make any payments until the forgiveness amount is remitted to the lender by SBA.
What If I Have Questions?
Frequently Asked Questions on Loan Forgiveness - PPP Forgiveness FAQ's
Please contact our Commercial Lending Team - [email protected]