PPP Loan Forgiveness

Sawyer savings has partnered with our core processor to provide a portal to assist our customers with applying for forgiveness.  This portal had been delayed a bit due to continuous changes being issued by the SBA.  However,  the portal to is now available to accept forgiveness applications.

Each borrower’s forgiveness period starts the day funds were put into their account and ends 24 weeks later or by December 31, 2020, whichever is sooner.  Payroll and Payroll related items must account for at least 60% of the forgiveness request.  Rent, Mortgage Interest, and Utilities are allowable expenses, but cannot be more than 40% of the forgiveness request.

There are no early payment penalties. Any amount that is not forgiven is expected to be repaid by the borrower under the terms of the note.

Maintain detailed records for all items you expect to submit for forgiveness.
For example, a copy of a lease for rent, bank statements for interest, payroll records and Invoices for all other items.  Additional documentation may be required.


Allowable Expenses

Forgiveness is for allowable expenses only:

  • Payroll and payroll related items
    • Health Care costs paid for by the employer.
    • Gross Payroll
    • NYS Unemployment Insurance.
    • Employer paid retirement costs.
  • Rent
    • A lease dated prior to February 15, 2020 is needed.
    • If there is not a lease, the borrower must be able to present 6 consecutive monthly payments.
  • Mortgage interest
    • 6 months of interest expense on any collateralized business loan.
    • This would include real estate loans, equipment loans, and secured lines of credit.
    • Unsecured business loans and leased vehicles are not covered.
  • Utilities
    • Heat
    • Electricity
    • Water service
    • Telephone and Cell Phones services
    • Internet
    • Fuel for company vehicles


Forgiveness Tests

In addition to documenting the required allowable expenses, borrowers must pass two forgiveness tests.


Full Time Employees (FTE) Salary Level
·      The base period for comparison is either 2/15/19 – 6/30/19 or 1/1/20 – 2/29/20. Whichever is lowest.

·      Any percentage decrease in your FTE count will reduce your forgiveness by that percentage.


·      The base period is the first quarter of 2020.

·      Any reduction of salary levels of over 25% for a single employee (making less than $100K annually) limits the forgiveness calculation.


  • Very Important – the FTE test and the Salary Reduction test both have safe Harbor timeframes.  There are 2 safe harbors.  December 31 OR the date you file for forgiveness.  This could take some planning but as long as you meet both the FTE test and the Salary Reduction test on the day you apply for forgiveness – there will be no limitation to your forgiveness.


Schedule C Filer Loan Forgiveness

A Schedule C filer will be allowed to apply for forgiveness based on 24/52 of the 2019 net income of the Schedule C. Schedule C filers should pay a draw amount equal to the PPP loan amount.



The SBA has placed banks in the position of “reviewing” all forgiveness applications for integrity and documentation.  For this reason, banks cannot provide significant assistance in the preparation of the forgiveness packages without losing our independence to conduct the review that is needed.  If you are not comfortable with your current tax preparer, Sawyer Savings can provide contact information to an accounting firm that is knowledgeable in the PPP process and preparation of your forgiveness application.


Please Click This Link to Start the Process.