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This page has been updated for recent changes due to the enactment of the Paycheck Protection Program Flexibility Act of 2020 (PPPFA) on June 5, 2020, and will step through what you need to know to manage your loan and to obtain forgiveness.
This guide will walk you through everything you need to know to get started with your PPP Forgiveness application.
Completing this Excel Document Checklist is highly recommended for all particularly those with loan amounts over $150,000 or those complex applications such as borrowers with affiliates, multiple payroll reports, businesses that are claiming forgiveness expenses on multiple properties.
While you can use the proceeds of the PPP loan for a wide range of expenses, if you want to obtain forgiveness, you are restricted in what you can use your PPP Loan for. Remember that the loan amount was based on 2.5 times your average monthly payroll from 2019. However, you can USE these funds for the following purposes and still get all or a portion of your loan forgiven:
On June 16, 2020, the SBA issued a simplified PPP Loan Forgiveness Application called the 3508EZ Form. This “EZ Form” is designed to reduce the required calculations for those that qualify. To qualify, borrowers must:
If you, a borrower, do not qualify under one of the three criteria, you must use the standard Forgiveness form called the “3508 Form”.
The EZ Form will be electronically available to you shortly in our electronic portal. However, if you want to see the current form and instructions, please go here:
While we will have this form online in our digital forgiveness process, PPP borrowers can download the application below to get a sense of what will be required. To be clear, CenterState PPP borrowers WILL NOT be submitting this form by email or sending it to their bankers but will be completing a digital application when the regulation and guidance is finalized. Download the application and instructions.
All CenterState PPP Borrowers will have to verify and/or input some critical pieces of information such as the Loan Number, your final loan amount, and exact form of your business name in order to complete the Forgiveness application. To assist you, CenterState will send this required data to you via secure email in the next couple of weeks. When you receive this information, please keep this information handy as it will speed your process.
Additional Application Form:
Note – If these documents are not in digital form, please take the time soon to scan these and get them ready for upload using an Adobe PDF, JPEG or PNG file format. Please note that you can take a high-quality picture of the document and then upload the photo.
The following documents should be kept for six years after the loan is forgiven or repaid in the event the Office of the Inspector General, Bank, SBA, IRS or other entity needs to review
If you received a grant up to $10,000 from the Economic Injury Disaster Loan (EIDL) program, these proceeds will be deducted from your PPP forgiveness amount. For example, if you have a $10,000 EIDL grant and a $100,000 PPP loan in which you qualify for 100% forgiveness, then your forgiveness amount will be $90,000, and you will then be required to pay off the $10,000 remaining over the term of the loan.
Your loan may not be approved for forgiveness or you may decide not to ask for forgiveness because you do not meet the forgiveness requirements. In this case, you will begin to make your principal and interest payments after the Deferral Period until the loan is extinguished.
FAQs are subject to change as more guidance becomes available.
|Item||Before (PPP)||After (PPPFA)|
|Payroll||75% of PPP must be spent on payroll||60% of PPP must be spent on payroll|
|Time Period to use funds (Covered Period)||8 weeks||8 or 24 weeks
• Borrowers must choose either period but must maintain staffing and salary levels for whatever period they choose. Once the Covered Period has ended, borrowers can run their business without impact to the Forgiveness amount.
|Rehire Requirements (for salary to count toward requirements)||Workers must be rehired by June 30, 2020||Workers must be rehired by December 31, 2020
• Unable to rehire individual who was an employee on or before 2/15/2020
• Able to demonstrate inability to hire similarly qualified employees on or before 12/31/2020
• Able to demonstrate inability to return to same level of business activity as before 2/15/2020
|Repayment Term||2 years (at 1% interest)||2 or 5 years (at 1% interest)
• PPPFA Loans made after June 5, 2020, will have a 5-year maturity.
• The unforgiven amount from a loan done before June 5, 2020, can be changed from 2 to 5-year maturity with CenterState’s approval.
|Deferment of payroll taxes||No deferment of taxes on forgivable portion of the loan||PPPFA allows borrowers to defer the employer portion of payroll taxes until December 21, 2020.|
|SBA loan audits||SBA can audit any loan at their discretion||No change|
|Maximum loan amount||2.5x borrower’s 1-month average payroll cost||No change|
|Number of PPP loans||One PPP loan per borrower||No change|
|Salary calculation for loan forgiveness||Payroll calculator in the loan application||No change|