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If you’ve received a loan through the Paycheck Protection Program (PPP), you may be eligible to request full or partial forgiveness of that loan from the SBA. We know this is a critical priority for many of you, and you may have questions regarding this forgiveness and how to apply for it.
The SBA recently released the PPP loan forgiveness application, along with some instructions for borrowers on how to complete the application; however, we’re still awaiting guidance from the SBA on the forgiveness process.
We’ll begin to accept forgiveness applications, within the timing already outlined by the SBA, and once they have finalized their guidance. We will provide additional information to Byline PPP loan customers as we receive it.
We’ve compiled a list of frequently asked questions, which we’ll continue to update throughout the forgiveness process.
We know there’s a lot to understand about the resources available to you. Here’s more information that can help.
Continue to check our website as well as
Not yet. We will provide additional guidance on our process soon, but rest assured that we’re working to make it automated and user friendly. Our goal is to simplify the questions and help to populate the forms. We hope to have additional instructions shortly.
If you have received a PPP loan through Byline Bank you must submit an application for forgiveness through Byline. We are setting up a process to handle the applications and will provide you with additional information and let you know how to submit your forgiveness application to us as we get additional SBA guidance.
Forgiveness applications cannot be submitted to Byline until at least 8 weeks following PPP loan disbursement. We will provide you with additional information and let you know how to submit your forgiveness application to us as we get additional information from the SBA.
No. You must submit an application for forgiveness through Byline. We’re setting up a process to handle the applications and will keep you informed as we get additional SBA guidance.
We don’t know yet. We will keep you informed as we get additional SBA guidance. It may take some time to review forgiveness applications and obtain a final determination from the SBA.
You must repay the principal and interest amount of the unforgiven portion over a 24 month period per the SBA requirements.
Yes. The outstanding principal and interest on that portion of the loan which was not forgiven must be repaid 2 years from the date of the loan.
Currently, within 8 weeks of loan disbursement (i.e., when loan funds were deposited into your account).
The 8 week period for determining eligible payroll costs begins, at a qualifying borrower’s election, either on (i) the date the PPP loan is disbursed (“Covered Period”) or (ii) the first day of the borrower’s first payroll period following the day of the PPP loan disbursement (the “Alternative Period”). The SBA has provided certain borrowers with administrative flexibility to ensure covered payroll costs are eligible for loan forgiveness. Please reference the SBA’s FAQs for Lenders and Borrowers for specific examples.
Under the CARES Act, payroll costs exclude the amount of an employee’s compensation in excess of an annual salary of $100,000, as prorated for the applicable period.
The SBA previously determined that this $100,000 limitation “applies only to cash compensation, not to non-cash benefits” includible as payroll costs, such as health and retirement plan contributions made on behalf of employees. The SBA has clarified that borrowers are to cap cash compensation eligible for forgiveness at $15,385 (the 8 week equivalent of $100,000 per year) for each employee.
Compensation for owner-employees, self-employed individuals and general partners of businesses is limited to the lesser of $15,385 or the 8 week equivalent of their applicable compensation in 2019. The prior guidance excluding from payroll costs health and retirement plan contributions made on behalf of such individuals remains unchanged.
The Instructions to Schedule A to the Application define “cash compensation” to include “the sum of gross salary, gross wages, gross tips, gross commissions, paid leave (vacation, family, medical or sick leave, not including leave covered by the Families First Coronavirus Response Act), and allowances for dismissal or separation paid or incurred during the Covered Period or the [Alternative Period].”
According to Schedule A of the Application, the following costs are considered eligible payroll costs:
Eligible non-payroll costs that are either 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, are eligible for loan forgiveness.
According to the application, an average full-time equivalent (“FTE”) employee headcount during the Covered Period or the Alternative Period is calculated as follows:
According to the Application, a borrower may exclude the following employees for purposes of the FTE reduction calculation:
The Application contains a detailed worksheet for borrowers to use in determining if an applicable employee’s average salary/wages during the Covered Period or Alternative Period, as applicable, was reduced by more than 25% compared to the employee’s average salary/wages for the period of January 1, 2020 through March 31, 2020. This calculation is to be performed for each employee who received compensation at an annualized rate of less than or equal to $100,000 for all pay periods in 2019, or who was not employed during 2019.
Please reference the Application and the SBA’s FAQs for Lenders and Borrowers for a description of the documentation needed.
At this time, the SBA has issued no guidance that outlines how it will “audit” relevant borrower certifications for loans above $2million.
The borrower is required to make a variety of certifications in submitting the Forgiveness Application, including but not limited to the following:
Also, the borrower must acknowledge that if it fails to provide information requested by the SBA, it may result in either a determination that the borrower was ineligible for the PPP loan or a denial of the borrower’s loan forgiveness application.
These questions are meant to provide some helpful guidance as you navigate PPP Forgiveness issues, but they are not inclusive and are subject to change. Please remember to:
We will provide updates here, as they become available. Thank you in advance for your support and patience as we wait on the SBA’s guidance.