Paycheck Protection Program Forgiveness Application
Frequently Asked Questions
Forms 3508 and 3508EZ and announcing new, simplified form 3508S!
As of October 8, 2020, there is great news for those with PPP loans of $50,000 or less: the Small Business Administration has released a simplified application to significantly streamline the forgiveness process. See below for more information.
For your convenience, we have included links to each of the three application types and their corresponding instructions below so you can choose the one that best fits your needs.
*For those with a PPP loan of $50,000 or less
*Includes checklist to see if you qualify to use the EZ form
Even with detailed instructions, some items may still be a little unclear. That’s why we compiled these FAQs to help you more confidently navigate the PPP loan forgiveness process. As this is a constantly evolving situation, visit the Small Business Administration website to view the most updated guidance.
1. Where can I find my SBA PPP loan number?
Application Instructions → SBA PPP Loan Number: Enter the loan number assigned by SBA at the time of loan approval. Request this number from the Lender if necessary.
To locate your SBA PPP loan number, please refer to the footer on the bottom right of your original loan approval documents. You should have a copy saved on your computer or in your email, as you signed and submitted the document to Keystone Bank digitally. You may also locate it by signing in to your online banking profile [and choosing “documents in the upper-right-hand corner]. (If you haven’t taken advantage of Keystone Bank online banking yet, here’s how to register https://my.bankkeystone.com/enroll)
2. What is the “Lender PPP Loan Number”?
Application Instructions → Lender PPP Loan Number: Enter the loan number assigned to the PPP loan by the Lender.
The SBA PPP Loan number and the Lender PPP Loan number are the same. (See instructions above for locating this on your original documentation.)
3. Where can I find the “disbursed principal amount” of my PPP loan?
Application Instructions → PPP Loan Amount: Enter the disbursed principal amount of the PPP loan (the total loan amount you received from the Lender).
Log in to Keystone Bank online banking to locate this amount. Follow these steps:
4. What if I don’t remember how many employees I had when I applied for a PPP loan?
Application Instructions → Employees at Time of Loan Application: Enter the total number of employees at the time of the Borrower’s PPP Loan Application.
Please reference the original application you submitted to Keystone Bank at the beginning of the loan process. Since this was submitted via email, you should either have a copy on your computer or in your sent folder of your email account.
5. What if I forgot to record the date I actually received my PPP loan proceeds?
Application Instructions → PPP Loan Disbursement Date: Enter the date that you received the PPP loan proceeds from the Lender. If loan proceeds were received on more than one date, enter the first date on which you received PPP loan proceeds.
Log in to Keystone Bank online banking to locate this date.
6. What are the “EIDL advance amount” and “EIDL application number”?
Application Instructions → EIDL Advance Amount: If the Borrower received an Economic Injury Disaster Loan (EIDL) advance, enter the amount.
Application Instructions → EIDL Application Number: If the Borrower applied for an EIDL, enter the Borrower’s EIDL Application Number.
The EIDL program is facilitated directly through the Small Business Administration. If you have an EIDL loan, it was not fulfilled by Keystone Bank, so we do not have this information. Please reference your EIDL documentation, as these numbers will have an effect on your calculations.
7. What is the difference between the “Covered Period” versus the “Alternative Payroll Covered Period”?
Application Instructions → Covered Period: The Covered Period is either (1) the 24-week (168-day) period beginning on the PPP Loan Disbursement Date, or (2) if the Borrower received its PPP loan before June 5, 2020, the Borrower may elect to use an eight-week (56-day) Covered Period.
Application Instructions → Alternative Payroll Covered Period: For administrative convenience, Borrowers with a biweekly (or more frequent) payroll schedule may elect to calculate eligible payroll costs using the 24-week (168-day) period (or for loans received before June 5, 2020 at the election of the borrower, the eight-week (56-day) period) that begins on the first day of their first pay period following their PPP Loan Disbursement Date.
With the “Covered Period,” you would calculate the 24-week period (or optional 8-week period for loans received before June 5) of payroll costs eligible for forgiveness beginning the exact day you received your PPP funds. With the “Alternative Payroll Covered Period,” you can begin calculating the day of the first pay period after you received the funds, which may be a beneficial option for your business. It’s important to keep these terms in mind when completing the application, as there are instances when you may need to include information for both or either/or.
8. How did the Paycheck Protection Program Flexibility Act of 2020 change the PPP forgiveness eligibility?
The Flexibility Act is intended to increase the likelihood small business owners will qualify for forgiveness on their PPP loans. Here’s what it means for you as a borrower:
- You may now utilize your PPP funds over a 24-week period.
The original 8-week period for utilizing the loan is extended to 24 weeks, though borrowers who received loans prior to the Act may choose the 8-week period instead.
- The deadline for spending PPP funds is extended through December 31, 2020.
This is an extension of the original June 30 deadline.
- You only have to use 60% of the loan on payroll to achieve forgiveness.
The 75%/25% payroll rule is now 60%/40%. You can now spend up to 40% on mortgage obligations, lease agreements and utility costs and still have the loan forgiven.
- You have 24 weeks, or until December 31, 2020 to restore your workforce and wages.
Previously, June 30 was the deadline for restoring your workforce levels and wages to pre-pandemic levels required for forgiveness.
- The 8-week covered period still remains an option for your business.
If you prefer to not use the 24-week covered period, 8-weeks is still an option for your business.
- There are two new exceptions for achieving forgiveness even if you don’t fully restore your workforce.
The Flexibility Act allows you to adjust forgiveness calculations if you are unable to find qualified employees or restore business operations to Feb. 15, 2020, levels due to restrictions related to the pandemic.
- Exemption for Facility Health Compliance.
The bill includes a new FTE exemption where the reduction in FTE was the result of an inability to rehire due to social distancing or other facility requirements (HHS, CDC, OSHA, State and Local orders and guidance).
For borrowers who have a loan equal to or less than $50,000:
9. Who qualifies for the simpler forgiveness option released by the SBA ?
Any one who has a PPP loan equal to or less than $50,000. You can access the form here.
10. Do I still need to submit my documentation?
Yes, under these new guidelines you still need to send in your documentation supporting the amounts you have spent on payroll costs and/or other forgivable expenses but you will not need to show additional calculations or justify you qualify for forgiveness.
11. Is my loan still forgiven if I had to reduce salaries or wages during the covered period?
Yes! Under these new regulations, your forgiveness amount will not be reduced if you had to reduce time, salary or wages for an employee or employees.
12. What if I had to let an employee go or put on furlough during the covered time?
Your loan forgiveness amount will not be reduced even if you had to make changes with employees during the covered period.
If you would like to use a payment calculator to assist in your documentation for the forgiveness application please feel free to download our calculator HERE.
For additional information and resources to ease your application process, please feel free to check out keystone.bank/ppp. This tool is not affiliated with Keystone Bank so please proceed at your own risk.