PPP Loan Forgiveness
Sawyer Savings is here to assist customers when applying for PPP loan forgiveness. Our loan servicing team is working with our borrowers to fill out the necessary information on the forgiveness applications that can be sent directly to a borrower via DocuSign. Once a signed application is received back, they will be submitted directly to the SBA by a member of the Sawyer Savings lending team.
Loan forgiveness applications can be found below.
Each borrower’s forgiveness period starts the day funds were put into their account and ends 24 weeks after. 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 agreement.
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.
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.
- 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.
- Water service
- Telephone and Cell Phones services
- Fuel for company vehicles
Schedule C Filer Loan Forgiveness
A Schedule C filer will be allowed to apply for forgiveness based on 24/52 of the 2019 or 2020 gross 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.