We’re truly grateful to the local businesses that trusted us to help secure Second Draw Paycheck Protection Program (PPP) funds for their businesses. As you receive these funds to help with payroll costs or other business expenses, we want to provide you with the most up-to-date information about the forgiveness process. Second Draw PPP loan forgiveness is not automatic, and you will need to submit a request to Northern Credit Union.
Second Draw PPP loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:
- Employee and compensation levels are maintained in the same manner as required for the First Draw PPP loan
- The loan proceeds are spent on payroll costs and other eligible expenses; and
- At least 60% of the proceeds are spent on payroll costs
You will need to compile the following documentation for Northern Credit Union to submit your request for loan forgiveness to the Small Business Association (SBA):
- Payroll costs, including benefits, as defined by the SBA.
- These can be bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees.
- Tax forms or equivalent reports from your third-party payroll service provider for the periods that overlap with the Covered Period or the Alternative Payroll Covered Period:
- Payroll tax filings reported, or that will be reported, to the IRS (typically, Form 941); and
- State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported, or that will be reported, to New York State
- Payment receipts, canceled checks, or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that the borrower included in the forgiveness amount.
Documentation for non-payroll expenses incurred or paid during the covered period of your loan must show that obligations or services existed prior to February 15, 2020.
- Business mortgage interest payments
- Copy of lender amortization schedule and receipts verifying payments, or lender account statements
- Business rent or lease payments
- Copy of current lease agreement and receipts or canceled checks verifying eligible payments
- Business utility payments
- Copies of invoices and receipts, canceled checks or account statements
We’ll provide updates, as the SBA releases additional information about forgiveness eligibility. The SBA also has information on its website.
Questions? Email our Paycheck Protection Program team at email@example.com.