PPP Forgiveness

Citizens State Bank is now accepting PPP Loan Forgiveness Applications for First and Second Draw loans originated in 2021. There are a few steps you can take to prepare, detailed below. When you're ready to apply, please contact your lender who will send you a secured link to a pre-filled application.

Understand the Forgiveness Terms

First 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
  • The loan proceeds are spent on payroll costs and other eligible expenses; and
  • At least 60% of the proceeds are spent on payroll costs

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
Compile Your Documentation

While most PPP loans under $150,000 don't require you to submit documentation with your forgiveness application, the SBA recommends you keep the following on hand.

Payroll (provide documentation for all payroll periods that overlapped with the Covered Period)
  • Bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees
  • Tax forms (or equivalent third-party payroll service provider reports) for the periods that overlap with the 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 the relevant state
  • Payment receipts, cancelled 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
  • Do NOT include the following when calculating eligible payroll costs for loan forgiveness:
Non-payroll (for expenses that were incurred or paid during the Covered Period and showing that obligations or services existed prior to February 15, 2020 for the first three listed obligations/services):
  • 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 cancelled checks verifying eligible payments
  • Business utility payments: Copies of invoices and receipts, cancelled checks or account statements
  • Covered operations expenditures: Copy of invoices, orders or purchase orders paid, and receipts, cancelled checks or account statements verifying eligible payments
  • Covered property damage costs: Copy of invoices, orders or purchase orders paid, and receipts, cancelled checks or account statements verifying eligible payments, and verification that costs were related to uninsured property damage due to public disturbance vandalism or looting that occurred in 2020
  • Covered supplier costs: Copy of contracts, orders or purchase orders in effect at any time before the Covered Period (except for perishable goods), and copy of invoices, orders or purchase orders paid, and receipts, cancelled checks or account statements verifying eligible payments
  • Covered worker protection expenditures: Copy of invoices, orders or purchase orders paid, and receipts, cancelled checks or account statements verifying eligible payments, and verification that expenditures were used to comply with COVID-19 guidance
After Your Submit Your Application

If the SBA undertakes a review of your loan, an SBA representative or your lender will notify you of the review and the loan review decision. You have the right to appeal certain SBA loan review decisions. Your lender is responsible for notifying you of the forgiveness amount paid by SBA and the date on which your first payment will be due, if applicable.

If you still have questions about the forgiveness process, take a look at the SBA's FAQ about PPP Loan Forgiveness or contact your lender.