Applying For Forgiveness
- A good place to start is to open the forgiveness applications and instructions. You do not need to fill these out because our portal will be used in place of the application, but reading through the forms and instructions will help. Click Here ›
- Also – review the document called Tips for Submitting a Successful PPP Forgiveness Package. Having the correct documentation ready will help.Click Here ›
- Review our video and PDF user guides on using the portal.
- Be sure you use Google Chrome or Microsoft Edge to access the portal.
- Read through the FAQs below. If you have a question – there is a good chance someone else does too. See if there is an answer to your question.
- If you have additional questions or you need access to our application portal, please email firstname.lastname@example.org or call us at 763-398-3060. We have a team of people available to assist you. Keep in mind the high call volume and be patient. Most times we will respond within 24-48 hours.
Portal User Guides
PPP Loan Forgiveness Applications
Use the application along with the information on this page to show what information will be required to be retained and/or submitted later with your forgiveness application. You will receive additional communication from Choice Bank with official instructions for submitting forgiveness applications, using an online portal.
The Forgiveness Application has borrower’s certifications that must be made. Please review the applications so you can be ready to make the certifications when requested.
This form may be used if your loan amount is $50,000 or less. (If the borrower together with its affiliates received PPP loans totaling $2MM – then this form may not be used.)
- Borrowers that can use this form are exempt from reductions in loan forgiveness amounts due to reductions in Full Time Equivalent (FTE) Employees or in salaries or wages.
- Borrowers are not required to show the calculations used to determine forgiveness amount but borrowers should retain calculations in case SBA requests it.
(See application instructions for full eligibility requirements of the 3508S)
The EZ form may be used by borrowers that can claim at least ONE of these:
- Are self-employed and have no employees; OR
- Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; OR
- Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.
(see application instructions for full eligibility requirements of the 3508EZ)
What Types of Expenditures are Eligible for Forgiveness?
The following are considered eligible expenses under the Paycheck Protection Program:
Borrowers are generally eligible for forgiveness for the payroll costs paid and payroll costs incurred during the 24-week (168-day) or eight-week (56-day) Covered Period (or Alternative Payroll Covered Period) or 24-week period. Payroll costs include:
- Salary, wage, commissions or similar compensations
- Payment of bonuses and hazard pay
- Payment of cash tips or equivalent
- Payment for sick, vacation, parental, family or medical leave
- Dismissal or separation allowance
- Payments for group health care benefits, including insurance premiums
- Payments for retirement benefits
- Payments of state or local tax on employee compensation, not Federal
- Annual compensation may not exceed $100,000 for any employee (or $15,385 during the covered period)
- Owner-employees and self-employed individuals’ own compensation can be no more than the lesser of 8/52 of 2019 compensation or $15,385 per individual across all businesses.
An eligible nonpayroll cost must be paid during the Covered Period or incurred during the Covered Period and paid on or before the next regular billing date, even if the billing date is after the Covered Period.
The application does not provide for use of any Alternative Covered Period for non-payroll cost tracking. Eligible nonpayroll costs cannot exceed 40% of the total forgiveness amount. Non-payroll Costs Include:
- Mortgage interest payments, not principal payments. (may not include prepayment of interest)
- Interest payments on any other obligations
- Business rent and lease payments on business property
- Utility payments for services such as electricity, gas, water, transportation, telephone or internet access.
- The mortgages and services must have been in place before February 15, 2020.
What Documentation Will I Need to Provide to be Approved for Forgiveness?
Similar to the PPP application process, your forgiveness application must be accompanied by supporting documentation for the eligible expenditures. The requirements are below and are also found on the instructions for each application.
Payroll Records for the 8-week (56-day) Covered Period or the Alternative Covered Period consisting of each of the following:
1. Documentation of cash compensation paid to employees
- 3rd party payroll reports or
- Bank account statements
2. Tax Forms (or equivalent 3rd party reports) – for covered period or alternative covered periods that overlap the covered / Alternative covered periods
- Payroll tax filings (941) and
- State wage reporting and unemployment
3. Payment receipts, canceled checks or account statement showing employer contribution to health insurance and retirement plans
Payroll Records for the Full-Time Equivalent (FTE) for the reference period you will use (see full instructions on Forgiveness Application ) consisting of each of the following:
1. Documentation of cash compensation paid to employees during the Reference Period used on the PPP forgiveness Application
- 3rd party payroll reports or
- Bank account statements
2. Tax Forms
- Payroll tax filings (941)
- State wage reporting and unemployment
1. Documentation verifying payments on covered mortgage obligations may be one of the following:
- Copy of lender amortization schedule and receipts
- Canceled checks verifying eligible interest payments
- Lender account statement from February 2020 and the months of the covered period through one month after the end of the covered period
2. Documentation verifying payments on covered lease (or rent) obligation may be one of the following:
- Copy of current lease agreement and receipts or canceled checks verifying eligible payments from the Covered Period;
- Lessor account statement from February 2020 and from the covered period through one month after the end of the covered period
3. Documentation of Covered Utility payments may be one of the following,
- Copy of invoices from February 2020
- Copy of invoices paid during the Covered Period
- Canceled checks
- Account statements verifying those eligible payments
NOTE: You only need to provide documentation for what you are requesting forgiveness for. If 100% of your loan was spent on payroll, nothing other than payroll records need to be submitted.
Documents that Each Borrower Must Retain for 6 years but is Not Required to Submit
- Documentation supporting wage information as shown on PPP Forgiveness Application
- Documentation of FTE Safe Harbor Reduction
- Records supporting borrowers certifications for the necessity of the PPP loan request and eligibility for PPP loan
What if my Loan is not Completely Forgiven?
With PPP Flexibility Act, it is expected that the majority of loans will achieve 100% forgiveness of principal and interest. If your loan is not completely forgiven, the remaining balance, including interest will be repaid in monthly installments to your loan maturity. Interest begins accruing from the first date of disbursement but is initially deferred to the date that SBA remits the borrowers loan forgiveness amount to the lender. If the borrower does not apply for loan forgiveness they will begin making payments 10 months after the end of the borrower’s loan forgiveness covered period.
Choice Bank cannot provide legal, tax or accounting advice. Please consult your own legal and accounting advisors as needed.
Guidance & Updates
- 6/16/20 – Interim Final Rule 3 and 6 Revisions
- 5/22/20 – Interim Final Rule SBA Loan Review Process and Borrower and Lender Responsibilities
- 4/24/20 – Interim Final Rule on Requirements for Promissory Authorizations Affiliation and Eligibility
- 4/14/20 – Interim Final Rule on Schedule C
- 3/26/20 – CARES Act – Section 1106
What is PPP Loan Forgiveness?
Up to 100% of your Paycheck Protection Program loan is eligible for forgiveness if you meet requirements set by the Small Business Administration (SBA). The amount of forgiveness you are eligible for is based on the amount of loan proceeds used for payroll costs and non-payroll costs over the 8-week (56-day) covered period from when the loan is disbursed.
The PPP Flexibility Act extends the covered period to the earlier of 24 weeks giving borrowers more time to use their PPP Loan Proceeds. Borrowers that had PPP loans prior to June 5, 2020, may elect to use the 8-week period mentioned above, instead of the 24-week period.
SBA allows for an Alternative covered period for borrowers with a biweekly (or more frequent) payroll schedule. The alternative covered period allows borrowers 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 (the “Alternative Payroll Covered Period”).
See example of the covered period and alternative covered period on page 1 of PPP Forgiveness Application Instructions.
The Flexibility Act states that 60% of the loan proceeds must be used for payroll. The remaining 40% can be used on utilities, rent and mortgage obligations that were in effect before February 15, 2020. If 60% was not used for payroll costs, your forgiveness will be reduced.
The total amount forgiven will also be reduced if your full-time employee (FTE) headcount declines or if the salaries and wages that you pay your employees decrease during your covered period (or alternative covered period) versus a reference period selected by borrower.
Allowable Reference Periods are:
- The average number of FTE employees on payroll per month employed by the Borrower between February 15, 2019 and June 30, 2019;
- The average number of FTE employees on payroll per month employed by the Borrower between January 1, 2020 and February 29, 2020; or
- In the case of a seasonal employer, the average number of FTE employees on payroll per month employed by the Borrower between February 15, 2019 and June 30, 2019; between January 1, 2020 and February 29, 2020; or any consecutive twelve-week period between May 1, 2019 and September 15, 2019.
You may be exempt from a FTE Reduction if you tried to hire an employee back, the employee was fired for cause or voluntarily resigned or voluntarily reduced their hours and their position was not filled by a new employee. See schedule A Worksheet on the Forgiveness Application to see if this Safe Harbor applies.
The Flexibility Act allows for 2 additional exemptions: if you could not find qualified employees or were unable to restore business operations to February 15, 2020 levels due to COVID-19 related operating restrictions.
Borrowers may have until the earlier of December 31, 2020 and the date the forgiveness application is submitted (previously June 30, 2020) to return FTE levels to where they were on February 15, 2020, to eliminate restrictions in forgiveness.