PPP Loan Program Forgiveness

 

SBA NOTICE: After more than a year of operation and serving more than eight million small businesses, funding for the bi-partisan Paycheck Protection Program has been exhausted. No new applications will be accepted at Lexicon Bank. The SBA will continue funding outstanding approved PPP applications, but new qualifying applications will only be funded through select financial institutions, specifically lenders who serve underserved communities. For details on these lenders, visit sba.gov.

We’re continuing our promise to you to help Nevada’s small businesses, our economic engine, get back on track—and fast.  As part of our effort, we now have a simplified approach to submitting your PPP loan forgiveness applications.

When you are ready to apply for PPP loan forgiveness, please:

  • Review Resources about the PPP loan forgiveness process

  • Watch a video to help you complete the application correctly

  • Submit your PPP loan forgiveness application via the link below

If you have not depleted your PPP funds yet, please let us know approximately when you believe you will be submitting your application by emailing us at sbaforgiveness@lexiconbank, so we can contact you at the appropriate time.  Ideally, you should apply within one month of depleting your PPP funds.

 

Note, you will start the application here in a separate tab window. Do not download a form. Use our form within the Lexicon Bank portal. You can pause and return at any time via a link that will be sent to your email.

Once we receive your forgiveness application, we will inform you of approximate completion timelines for your specific application. We are here to assist you through the process.  If you have questions at any time, please contact us at sbaforgiveness@lexiconbank.com.

PPP Loan Forgiveness Resources —

For sole proprietorship, independent contractor and self-employed Individuals and companies with W-2 employees. These are loan borrowers over $150,000.

For PPP loan borrowers who received $150,000 or less from Lexicon Bank. These are official instructions from the SBA. (An External Link)

General eligibility information to get you started.

PPP Loan Forgiveness Guidance

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What You Need To Know:

The new Paycheck Protection Program Flexibility Act (PPPFA), signed into law, significantly eases the requirements for reaching maximum forgiveness under the PPP Loan Program. 

A Few Takeaways Include:

  • Time period to use PPP funds is extended from 8 to 24 weeks. This will make it significantly easier to qualify for maximum forgiveness. If you already achieve maximum forgiveness under 8 weeks, you may still use the 8 week covered period.

  • Amount of loan that needs to be spent on payroll is 60%. Funds available for other qualifying expenses is 40%.

  • Safe harbor date to restore workforce levels to pre-COVID levels is pushed back from June 30 to December 31. As long as you restore your FTE employee levels by December 31, 2020 to your FTE employee levels in the pay period that included February 15, 2020, you can claim the FTE reduction safe harbor —  meaning that you will then be exempt from loan forgiveness reduction. Note that salaries are still calculated the same way: employee compensation eligible for forgiveness is still capped at $100,000 annualized.

  • No reduction in forgiveness if business restrictions prevent you from restoring FTE levels. It seems like you may have a reduction in FTEs without seeing your forgiveness reduced if you are unable to restore FTE levels due to business restrictions – say, if you reopen at reduced capacity following your local health agency rules. This is in addition to the exclusions allowed for inability to bring workers back, termination for cause, or voluntary quit/hours reductions. Details are still unclear and we await further guidance. One thing is clear: you will certainly need to document in writing as thoroughly as possible your efforts to rehire through December 31.

  • Loan repayment term is up to 5 years at 1% interest to repay any unforgiven part of your loan, and the first payment will be deferred for 6 months after the SBA makes a determination on forgiveness.

  • You can now delay the payment of your payroll taxes. The bill allows businesses that took a PPP loan to delay payment of their payroll taxes, which was previously prohibited under the CARES Act.

  • The official text can be found here.

To qualify for loan forgiveness, PPP funds must be used for one or more of the following expenses billed or incurred in the 24-week period triggered after you received your loan:

  • Payroll costs, including employee benefits

  • Interest on mortgage obligations, where the mortgage obligations originated before February 15, 2020

  • Rent, under lease agreements in force before February 15, 2020

  • Certain utilities, for which service began before February 15, 2020

Based on the latest guidance from the SBA, you may submit a loan forgiveness application any time on or before the maturity date of your loan. We will notify you by email of any changes to your loan forgiveness application window.

Note, you will start the application here in a separate tab window. Do not download a form. Use our form within the Lexicon Bank portal. You can pause and return at any time via a link that will be sent to your email.