Updated Information Regarding the Paycheck Protection Program (PPP)
Updated: January 21, 2021
Keeping your business, your employees and your family whole is your priority. Our priority is helping you do that. Kennebunk Savings is here to help you navigate the complexities of the current business environment and the Small Business Administration’s Paycheck Protection Program (PPP) created by the passing of the CARES Act. The Act and subsequent amendment have allocated funds to help small businesses keep workers employed amid the pandemic and associated economic downturn.
One-page forgiveness application
In accordance with recently passed legislation, the SBA has released revised forgiveness Form 3508S for borrowers who have received PPP loans of $150,000 or less. The Form is a one-page certification with a minimal amount of information required. Please note a specific representation required of the borrower, among others, certifying that:
The Borrower has complied with all requirements in the Paycheck Protection Program Rules (Sections 7(a)(36), (7)(a)(37), and 7A of the Small Business Act, the PPP interim final rules, and guidance issued by SBA through the date of this application), including the rules related to:
- Eligible uses of PPP loan proceeds
- The amount of PPP loan proceeds that must be used for payroll costs
- The calculation and documentation of the Borrower’s revenue reduction (if applicable)
- The calculation of the Borrower’s Requested Loan Forgiveness Amount
Also of note from the Form’s instructions:
SBA Form 3508S does not require borrowers to show the calculations used to determine their loan forgiveness amount. However, SBA may request information and documents to review those calculations as part of its loan review or audit processes.
The new SBA Form 3508S can be found here.
Changes to the forgiveness applications
In addition to the new Form 3508S noted above, some minor changes have been made to Forms 3508 and 3508EZ.
Forgiveness application checklist
Please use this checklist as you begin your loan forgiveness application. If you have any questions please reach out to your PPP bank contact or our Customer Care team at 1-800-339-6573.
Forgiveness expense worksheet
Please use this Forgiveness Expense Excel Worksheet to help with the PPP forgiveness validation process. If you have questions about how to use this worksheet, please reach out to your Kennebunk Savings bank contact.
This checklist will help you gather all required documents around payroll and employee documentation.
As always, we are here to help! If you have any questions or need help navigating the PPP process, please reach out to our Customer Care team at 1-800-339-6573.
PPP Forgiveness Process
On Wednesday, June 17, 2020, the SBA and Treasury issued eagerly anticipated additional guidance and revised forgiveness applications based on legislation signed by the President on June 5th. Among other things, the underlying bill, H. R. 7010 – Paycheck Protection Program Flexibility Act of 2020:
- Increased the allowable portion of non-payroll expenses for a forgivable PPP loan from 25% to 40%
- Extended the “covered period” from 8 to 24 weeks for loans disbursed or applied for on or after June 5th (borrowers that received loans prior to that date have the option of 8 or 24 weeks)
- Revised the payment deferral period
The following links will lead you to the updated applications and the current SBA PPP FAQ’s:
We strongly encourage you to explore all of the PPP resources available on the SBA and Treasury websites and to consult with your financial advisors or accountants as you negotiate the PPP and forgiveness process. There are a number of other articles, webinars, videos, and other resources available on the internet, however, we would caution you to always ensure you validate the information presented and separate opinions and interpretations from facts.
If you have been granted a PPP loan from an institution other than Kennebunk Savings, please refer to their website for additional details and instructions for the loan forgiveness process.
We are committed to being available to assist you as you navigate the PPP process and to help ensure your PPP financing transaction concludes successfully.
If you have any questions or need help navigating the PPP process, please reach out to our Customer Care team at 1-800-339-6573.