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Small Business Administration (SBA) Paycheck Protection Program Loan Forgiveness

The Paycheck Protection Program (PPP) has provided financial relief through the Small Business Administration (SBA) to businesses across the U.S. that have been impacted by COVID-19. Wilson Bank & Trust has assisted many small businesses in accessing these funds.

As your lender, we continue to closely monitor the activity coming from the U.S. Treasury and SBA and we will communicate with you as soon as final guidance is released, or if there are any changes to existing information. At this time, the loan forgiveness process has not started. As soon as we can accept forgiveness applications, we will reach out to you to help you work through that process. Here are some additional details about the program:

Guidelines for how the funds must be used:

Updated Procedures
The Paycheck Protection Program Flexibility Act has amended several rules and requirements of the Paycheck Protection Program to provide more flexibility for businesses and make it easier to qualify for loan forgiveness. These updates include: 

Covered Period Extended up to 24 Weeks
The covered period during which PPP funds used for eligible expenses can qualify for forgiveness has been expanded from eight weeks to 24 weeks or until December 31, 2020 (whichever is earlier). However, borrowers that received their PPP loan prior to the enactment of the Paycheck Protection Program Flexibility Act still have the option to use the previous eight-week covered period.

Payroll Requirement Lowered to 60%
Under the new PPP rules, eligible non-payroll business expenses can account for as much as 40% of the forgiven loan amount. Please note: Per the language of the Paycheck Protection Program Flexibility Act, borrowers must spend at least 60% of the loan proceeds on payroll costs. If a borrower uses less than 60 percent of the loan amount for payroll costs during the forgiveness covered period, the borrower will continue to be eligible for partial loan forgiveness, subject to at least 60 percent of the loan forgiveness amount having been used for payroll costs.

Businesses Have Until December 31 to Return to Full Employment
Under the previous rules of the Paycheck Protection Program, a business had to maintain or restore its number of full-time equivalent (FTE) employees by June 30 to qualify for full loan forgiveness. This deadline has been extended to December 31, 2020 (however, borrowers who received their PPP loan prior to the Paycheck Protection Program Flexibility Act have the option to still use the initial eight-week covered period).

An exemption to this requirement is now available for businesses that can document, in good faith, that they were unable to fill open positions due to an inability to hire or rehire qualified employees or because business activity was impacted due to compliance with government safety guidelines.

Extended Payroll Tax Deferment for Loan Forgiveness Recipients
Under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), a business with a PPP loan could defer payments of the employer’s share of 2020 Social Security taxes until they are granted forgiveness of their PPP loan. This has been amended to allow businesses that receive PPP loan forgiveness to continue delaying payment of these taxes. Please speak with your tax advisor for additional guidance. 

Extended Deferment Period
Previously, PPP loan payments could be deferred for six months from the date that the funds were received. Now this deferment period will end on the date that your amount of loan forgiveness is determined or 10 months after the last day of the covered period if you do not apply for loan forgiveness within that time.

Thank you for the opportunity to support your business. If you have any questions, please contact [email protected].

Additional Resources for PPP Borrowers

Revised Interim Final Rules (as June 26, 2020)

EZ Forgiveness Application

EZ Forgiveness Application Instructions

Forgiveness Application Standard

Forgiveness Application Standard Instructions

Expense Tracking Worksheet*

*This is intended to assist you in keeping track of expenses and records that may be needed to determine PPP forgiveness.  As of 5/15/2020, the SBA has not provided specific details on what will be necessary.  This worksheet is in no way a guarantee of the required information and should not be inferred as any determination of forgiveness.  The use of the worksheet is voluntary and forgiveness is not dependent upon worksheet use.

Interim Final Rule
Interim Final Rule- Additional Eligibility Criteria and Requirements for Certain Pledges of Loans, Treasury’s website



To the best of our knowledge, this information was correct as of July 6, 2020. Given the rapidly developing situation, and the possibility of new guidance being issued at any time, be mindful that some of this information may change. We are working diligently to put forth the most current information as it becomes available.


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