Paycheck Protection Program

PPP Forgiveness Information and Resources

Updated January 21, 2021: The government has passed a new stimulus bill that authorizes additional funding and streamlined forgiveness for the Paycheck Protection Program (PPP). On December 27, 2020, the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (Economic Aid Act) was enacted, which reauthorizes lending under the PPP through March 31, 2021.

These SBA forgivable loan programs were created to assist small businesses in meeting payroll and other critical expense needs. These loans require a certification that current economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.

How to Calculate Loan Amounts (Detailed SBA Guidance)
Before you begin, please carefully review the below SBA guidance on how to calculate and properly document PPP loan amounts:

How to Calculate Maximum Loan Amounts for First Draw PPP Loans and What Documentation to Provide – By Business Type (1/17/2021)

Second Draw PPP Loans – How to Calculate Revenue Reduction and Maximum Loan Amounts Including What Documentation to Provide (1/19/2021)

Updated First Draw PPP Loan Application

The “First Draw” PPP program is reopened with additional funding.  This is only open to borrowers that did not receive an initial PPP loan. 

SBA First Draw Borrower Application (SBA 2483)

Top-Line Overview of First Draw PPP Loans (Released 1/8/21)

Interim Final Rule #1 – PPP as Amended by Economic Aid Act (Released 1/6/21)

Applying for an Increase to a First Draw PPP Loan (Recalculated First Draw)

Under certain circumstances, a client may apply for an increase in their original “First Draw PPP” loan amount. 

See pages 40 or 74-76 of Interim Final Rule #1 – PPP as Amended by Economic Aid Act (Released 1/6/21)

Second Draw PPP Loan Application

A “Second Draw” PPP program is created and opened.  This program has slightly different rules than “First Draw” PPP loans and is targeted to borrowers that had a revenue reduction of 25% or greater in any quarter of 2020 versus the same quarter of 2019.  

SBA Second Draw Borrower Application (SBA 2483-SD)

Top-Line Overview of Second Draw PPP Loans (Released 1/8/21)

Interim Final Rule #2 – PPP Second Draw Loans (Released 1/6/21) 

Please follow these 5 steps to expedite your application as quickly as possible.

1. Choose the proper application.You will need to download the PDF file before filling anything in.

SBA First Draw Borrower Application (SBA 2483) (First Draw or Recalculation)

            OR

SBA Second Draw Borrower Application (SBA 2483-SD)

• IMPORTANT: download the PDF file first.
• Fill it out in its entirety or it will be returned.
• Save the PDF version of your application after signing.
• We will only accept PDF format, so please be sure that’s how you’ve saved your file.

2. Provide all relevant applications and supporting documentation (application scanned as a single PDF document and supporting documentation scanned as a single PDF document).

• If you are applying for a “First Draw” PPP loan, you must provide the “First Draw” PPP application and all documentation listed below.
• If you are applying for a “Recalculated First Draw” PPP loan, you must provide the “First Draw” PPP application, a description of how you have arrived at your “Recalculated” loan amount, and any supplementary documentation to support the request.
• If you are applying for a “Second Draw” PPP loan and Compeer was your lender on your original PPP loan and you are using the same reference period for payroll cost as the original loan, you may just submit the “Second Draw” application. If we require any additional documentation, we will contact you.
  • If your “Second Draw” request is greater than $150,000, you must provide documentation for the 25% revenue reduction calculation at the time of application.
  • If the request is less or equal to $150,000 the documentation for the 25% revenue reduction will be required at the time of loan forgiveness.
• If you are applying for a “Second Draw” PPP loan and Compeer was your lender on your original PPP loan and you are using a new reference period (i.e. 2020) for payroll cost, you must submit the “Second Draw” application and all documentation listed below that documents your payroll cost for the new reference period.
  • If your “Second Draw” request is greater than $150,000, you must provide documentation for the 25% revenue reduction calculation at the time of application.
  • If the request is less or equal to $150,000 the documentation for the 25% revenue reduction will be required at the time of loan forgiveness.
• For specific guidance on how to calculate maximum loan amounts see pages 31-42 of Interim Final Rule #1 – PPP as Amended by Economic Aid Act (Released 1/6/21)

Provide all documentation that verifies numbers used in your calculations. Below is a list of common documentation:

• If you have employees:
  • A payroll statement covering the period of 2/15/2020 that establishes you were in business and had employees on that date
  • Include the 1040 Sch 1 if you submit a Sch F
  • Wages: IRS 943 or IRS 941’s to document your payroll cost
    • (Legal Entities also must provide the full IRS 1120-S, 1120, or 1065)
  • Benefit Expense: 1040 Sch C (lines 14 & 19) and/or 1040 Sch F (lines 15 & 23)
    • (Legal Entities also must provide the full IRS 1120-S, 1120, or 1065)
  • You must also provide documentation of any retirement or health insurance contributions that support those deductions on the Sch C or Sch F (or IRS 1120 or 1065)
  • State quarterly wage unemployment insurance tax reporting form from each quarter (SUTA)
  • Net earnings from self-employment: 1040 Sch C (use only line 31) or 1040 Sch F (Sch F filers use gross income line 9 less other payroll costs documented above)
    • (Partnerships and LLC’s: Full IRS 1065 and all K-1’s.  You must carefully review the SBA guidance beginning on page 40 of Interim Final Rule #1 – PPP as Amended by Economic Aid Act (Released 1/6/21) )
• If you do not have employees:
  • A document that proves you were in business in 2019 such as an invoice, ledger, or bank statement
  • A document that proves you were in business on 2/15/2020 such as an invoice, ledger, or bank statement
  • Include the 1040 Sch 1 if you submit a Sch F
  • Net earnings from self-employment: 1040 Sch C (use only line 31) or 1040 Sch F (Sch F filers use gross income line 9 less other payroll costs documented above)
    • (Partnerships and LLC’s: Full IRS 1065 and all K-1’s.  You must carefully review the SBA guidance beginning on page 40 of Interim Final Rule #1 – PPP as Amended by Economic Aid Act (Released 1/6/21) )

3. Submission

• Submit all pages of the application as a single PDF file.
• Submit the needed supporting documents per the guidance in Step 2 as a single PDF file.
• Submit a document that explains your calculation (shows your work).

4.  Please submit only one application and supporting documentation

• If you need to amend your application, please contact your Financial Officer.

5.  Submit to the Portal.

PPP Forgiveness Information and Resources

We are awaiting revised guidance and loan forgiveness applications from SBA.

Since the new legislation also contains changes to the forgiveness process. Compeer Financial recommends clients pause on submitting PPP forgiveness applications at this point. We will not be submitting any additional PPP forgiveness applications to SBA until we receive guidance from SBA on the changes to the forgiveness process.

Loan forgiveness will be dependent on the client expending the funds on documented payroll costs, covered mortgage interest payments, covered rent payments, covered utilities, covered operations expenditures, covered property damage costs, covered supplier costs, and covered worker protection expenditures, and not more than 40% of the forgiven amount may be for non-payroll costs.

Questions about the PPP loan program? Please contact [email protected]

Disclosure:
If your application for business credit is denied, you have the right to a written statement of the specific reasons for that denial. To obtain that statement, please contact us within 60 days from the date that you were notified of our decision. We will send you a written statement of the  statement. NOTICE: The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract), because all or part of the applicant's income derives from any public assistance program, or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The federal agency that administers our compliance with this law is the Farm Credit Administration, 1501 Farm Credit Drive, McLean, VA 22102-5090.