PPP 2 Forgiveness Application

Banks are currently opening the forgiveness application portal for anyone who received the PPP 2 Loan. At this point, we recommend the following:

  1. You wait until your covered period is over to submit for loan forgiveness. There is no rush to complete this process. You have up to 10 months after your covered period is over to submit for forgiveness.

2. If you plan to submit yourself, please remember the following:

a. You will cap owners at $20,833.00 and employees at $46,154.00 in gross wages when determining                 total payroll wages paid for during the covered period. Also, remember to subtract out any FFCRA                 wages or Employee Retention Credit (ERC) wages (see #4 below).

i. We recommend you use wages to simplify the application, assuming you have enough to cover the                 entire PPP proceeds you received.

ii. PPP proceeds need to have at least 60% used on payroll costs. This includes the following: wages,                  state employer tax, retirement match, and health insurance.

b. You will want to keep any reports you use on this calculation and a copy of your forgiveness                              application filed for four years.

i. Please contact us if you need further guidance on the back-up needed depending on what you use                  for the PPP forgiveness application.

c. If you have not already submitted the application, you will be required to give the bank a copy of your           Profit and Loss report showing you had at least a 25 percent reduction of gross receipts in one of the             quarters in 2020 compared to the same quarter in 2019.

d. If your PPP loan is over 150K, you will be required to submit your workpapers to the bank.

3. If you plan to have Fluence help with your forgiveness application submission, please let us know so we        can add you to our tracking schedule.

a. We will not start this process until the midpart or end of August when most of our clients’ covered                  periods are over.

b. We will give you instructions to submit this to your bank, a copy of the application with final                            numbers to use, and workpapers you will keep for four years and/or submit to the bank if your loan              is over 150K.

4. Employee Retention Credit (ERC) for 2021 – If your gross receipts (collections) are down 20% or more         in any quarter in 2021 compared to where it was in 2019, you will qualify for a 2021 ERC.  It is                       important you reach out to us before you submit for your PPP 2 forgiveness application.

a. If you are eligible for this credit, you will not want to use any wages for the ERC that you use for the             PPP forgiveness application.

b. This may mean you will need to use non-payroll costs to maximize both the ERC and the PPP                           forgiveness.  Again, payroll costs need to be at least 60% of the PPP loan proceeds used.

c. Fluence will be reviewing if any of our clients are eligible for this credit and will let you know.

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