Important Information Regarding COVID-19 and PPP

Update as of October 13th, 2020:
Simpler Loan Forgiveness Application Process

On October 8, 2020, the SBA in consultation with the U.S. Treasury, released a “simpler” loan forgiveness application for PPP loans of $50,000 or less. The new application also makes borrowers for PPP loans under $50,000 exempt from: (1) any reduction in forgiveness based on FTE employee reductions; and (2) any reduction in forgiveness for any salary or wage reduction.

Borrowers must still complete a one-page application which includes certifications on the use of the funds.

Click here to view the simpler loan forgiveness application (“Form 3508S”)

In addition, documentation is still required to be submitted for payroll and nonpayroll cost validation.

Click here to view the instructions for completing the simpler loan forgiveness application.

NOTE: This is not “blanket” or “automatic” forgiveness.  Borrowers must still provide support for their forgiveness request. 

All 3508S applications should be submitted using this option our website – which is the option for borrowers to file a scanned application and attach required documentation.

Application Tips for All Borrowers

We recommend the following tips for ALL borrowers submitting loan forgiveness applications:

  • Select a 24-week Covered Period – by doing so, this allows you to include more costs. Applications may be submitted at anytime prior to 24 weeks but you should still input 24 weeks as your Covered Period.  In addition, owners can receive the full 2.5 months of their 2019 income (up to $20,833) if the 24-week Covered Period is selected
  • Start with Payroll Costs – if your payroll costs exceed your loan amount you do not need to include other nonpayroll costs. In addition, if cash compensation exceeds your loan amount you do not need to include health insurance or retirement costs
  • Provide Owner Tax Returns – all owners who are included in payroll costs must provide 2019 tax documents (W-2, Schedule C, K-1, etc.)
  • Provide Complete Payroll Documentation – payroll must be supported by the following documents for the Covered Period:
    • Forms 941 for each quarter in 2020
    • Third-party payroll report OR Internal payroll report plus bank statements validating payment of payroll
  • Provide Complete Documentation for All Other Costs – generally all other costs need to be supported by:
    • Invoices, receipts AND validation of payment (bank statements, cancelled checks, etc.)
    • Mortgage, rent, lease and utility payments must also include documentation that the obligation was in existence prior to February 15, 2020 (bank statements, cancelled checks, lease agreements, etc.)

 

Update as of September 15th, 2020:
PPP Deferment Update

Due to delays in finalizing all of the details with the forgiveness process, SBA has deferred the date that your first payment will be due on your Small Business Administration (SBA) Payroll Protection Program (PPP) loan.

If you apply for PPP loan forgiveness (and submit all required supporting documentation) within 10 months following the end of your Covered Period*, you will not be required to make any payments until after SBA has made a final forgiveness determination on your loan and either SBA remits a payment to us based on its forgiveness review or notifies us that no loan forgiveness is allowed.

If you do not apply for SBA forgiveness (or do not submit all required supporting documentation) within 10 months following the end of your Covered Period, or if the SBA determines that the loan is not eligible for forgiveness (in whole or in part) at any point in time, your loan payments will begin at that time.

You will be notified of the date your first payment is due. Regardless of the start date of your first payment, interest will continue to accrue during the deferment period and any balance still owing will be amortized over the remaining term of your loan (the first payment will also include interest then owing which has accrued from your original loan disbursement date). The maturity date of your loan will not be extended.  You may always prepay your PPP loan at any time.

The information provided above is based on our understanding of the CARES Act and the Paycheck Protection Program Flexibility Act, as enacted, and additional guidance provided by SBA and the U.S. Department of Treasury in effect as of September 13, 2020, and is subject to change based on any future laws, regulations or programs, or any future rules or guidance issued by SBA or other relevant regulatory authorities.

*The Covered Period is either (a) the 24 week (168 day) period beginning on your PPP loan disbursement date, or (b) if you received your PPP loan before June 5, 2020, you may elect to use an eight week (56 day) Covered Period.  For example, if you are using a 24 week Covered Period and received your PPP loan proceeds on Monday, April 20, the first day of the Covered Period is April 20 and the last day of the Covered Period is Sunday, October 4.  In no event may the Covered Period extend beyond December 31, 2020.

 

Update as of July 15th, 2020:
Helpful Reminders When Completing the Loan Forgiveness Application

Before starting the online process, we recommend that you have all of the information required for the Application, including supporting documents. Download this additional list of potential items needed for your Application. Once you begin the application process, you will have the option to save your work and resume at a later date. In order to expedite your application, please make sure to follow the important steps below to avoid common errors that could delay your application.

1) Borrowers have the option to elect a 24-week Covered Period as opposed to the original 8-week period. The SBA has clarified that a Borrower may submit a loan forgiveness Application prior to the end of the 24-week period once the PPP loan proceeds have been used.

2) The business name on the forgiveness application should match the PPP loan application.

3) Both your SBA and Independence Bank loan numbers must be provided and can be found on the initial email from Independence Bank.

4) Double check that your Tax ID number is correct and is the same as your loan application.

5) The Loan Disbursement Date is the date you received the funds from Independence Bank.

6) The first date of your Covered Period MUST be the same as your disbursement date.

7) Even if you file early, the Covered Period MUST be either 8 or 24 weeks. For 8 weeks add 55 days to your disbursement date. For 24 weeks add 167 days.

8) Even if you file early, the Alternative Payroll Covered Period must also be either 8 or 24 weeks.

9) In addition to any internal payroll spreadsheets reconciling Payroll Costs a Borrower must provide either a payroll report from its payroll processor or a bank statement showing the payment of the funds. This applies for both the FULL and EZ Applications.

10) The maximum amount that can be included in cash compensation per employee:
$15,385 for 8-week Covered Period (8 weeks of $100,000 annualized)
$46,154 for 24-week Covered Period (24 weeks of $100,000 annualized)

11) The maximum amount that can be included in payroll costs per owner-employee or self-employed:
$15,385 for 8-week Covered Period (8 weeks of $100,000 annualized)
$20,833 for 24-week Covered Period (2.5 months of $100,000 annualized)

12) Schedule C filers are capped by the amount of their “owner compensation replacement” calculated based on 2019 net profit (line 31). Schedule C should be provided as part of your supporting documentation to the loan forgiveness application.

13) For Schedule C filers, health insurance and retirement benefits may not be included.

14) For S-Corps, health insurance benefits for owners may not be included.

15) Only State and Local employer-paid taxes can be included such as state unemployment taxes.

16) Employers cannot include 1099 employees as part of payroll costs in the forgiveness calculation.

17) For ALL NON-PAYROLL costs, you must include documents that verify that the obligation was in existence prior to Feb. 15th, 2020. This could include utility invoices, lease document, bank statements or mortgage statements from before Feb 15th.

18) If your loan forgiveness is less than 100% of your loan, you may be eligible for additional loan forgiveness by extending the Covered Period to 24 weeks. (You may file early once the funds have been used).

19) It is strongly encouraged that borrowers provide supporting spreadsheets which reconcile all categories of costs. Processing could be delayed if the bank has difficulty finding and comparing amounts in the documentation to the costs submitted in the application.

We appreciate your effort to make this a smooth process. If you have any questions, please contact your Independence Bank loan officer.

 

Update as of June 22nd, 2020:
PPP Loan Forgiveness Application Process

We are pleased to be able to assist you on the loan forgiveness step of the SBA Payroll Protection Program (PPP). As you know, the PPP allows for all or a portion of the loan and accrued interest to be forgiven if the proceeds are used for payroll and certain non-payroll costs.

On June 16, 2020, the SBA, in consultation with the Department of the Treasury, released a revised PPP loan forgiveness application (“Application”) which implements the changes from the PPP Flexibility Act of 2020, signed into law by President Trump on June 5, 2020. In addition to a revised full Application, the SBA has issued an abbreviated “EZ” Application which simplifies the process for certain borrowers. As a result of these releases, we are now accepting Applications for loan forgiveness.

If you need assistance with completing the Application, we recommend contacting your accounting or tax advisor. Your payroll provider may be able to assist with the specific required payroll and employee information. Additional resource information may be found at the SBA’s main site for this program. As always, you may contact your Independence Bank loan officer with any questions.

The “Forgiveness” portion of the SBA PPP has a much longer timeframe for submission and review than the initial application process. The Bank has therefore implemented an online portal submission system that will streamline and expedite this process as quickly as possible.

To begin the process, we recommend that you print a copy of the relevant Application and instructions. Please read the instructions thoroughly, and work through the entire Application before beginning the submission process outlined below.

ONLINE APPLICATION INSTRUCTIONS

Before starting the online process, we recommend that you have all of the information required in the Application, including supporting documents. Download this list of potential items needed for your Application. Once you begin the application process, you will have the option to save your work and resume at a later date.

Option 1: Automated FULL Application and Submission [Get Started]

Option 1 is for the FULL Application that was revised on June 16, 2020 and may be used for either an 8 or 24 week Covered Period. Features include:

  • Online data entry form
  • Autofill of Application pages required to be submitted, including calculations
  • E-signature capability
  • Direct submission of your Application to the Bank
  • Upload all supporting documents
  • FULL Form Instructions

This online tool including calculations is provided for your convenience. Each Applicant is responsible for double-checking and certifying all calculations including the loan forgiveness amount.

Option 2: Automated EZ Application and Submission [Get Started]
The EZ Application simplifies the process but does not change the requirement to submit documentation to support eligible payroll and non-payroll expenses. The EZ Application may be used for either an 8 or 24 week Covered Period and is generally available to borrowers who are either:

(1) self-employed with no employees

(2) can certify they have not reduced the number of FTE employees AND have not reduced salaries or wages for any of their employees by more than 25%
(3) can certify they have experienced a reduction in business activity as a result of federal health directives related to COVID-19 AND have not reduced salaries or wages for any of their employees by more than 25%.

Features include:

  • Online data entry form
  • Autofill of EZ Application pages required to be submitted, including calculations
  • E-signature capability
  • Direct submission of your EZ Application
  • Upload link for all supporting documents
  • Form EZ Instructions

This online tool including calculations is provided for your convenience. Each Applicant is responsible for double-checking and certifying all calculations including the loan forgiveness amount.

Option 3: Submission of Already Completed Application [Get Started]
Option 3 may be used to submit either the FULL or EZ Application. The process includes:

  • Uploading your already completed Application (in PDF)
  • Uploading all supporting documents

Upon submission through any of the above options, you will receive an email confirmation that your Application has been received. Processing time will be dependent on the volume of Applications received by the Bank. The CARES Act allows the Bank 60 days to approve an Application and submit to SBA once a complete Application has been submitted. Additionally, the SBA has 90 days to approve. The amount of loan forgiveness is not final until approved by both the Bank and the SBA.

 

Update as of May 13th, 2020:

Customers who participated in the Paycheck Protection Program (PPP) with Independence Bank, will be receiving important communication by email and contact from their lender regarding next steps of this program, which is the loan forgiveness process. Please familiarize yourself with this best practice information as detailed by the SBA as we begin to enter the next phase of this process. Borrower information and best practices can be found here. We appreciate your assistance as we navigate through this process together. If you have any questions at all, throughout this process, please contact your loan officer.

 

Update as of May 12th, 2020:

Be Mindful of Scams
Please be mindful of scams that could appear as emails, social media posts, calls, texts or on websites. Utilities cannot be disconnected for non-payment during our current state of emergency. Do not send payment to scammers threatening to cut off your utilities. Always check the validity of the source by calling your utility company directly with the publicly listed number, do not reply back to an email that looks suspicious and don’t give out personal or financial information to someone that has called you requesting payment or they will shut off your utilities. For additional information, including how to report scams, please view the press release sent out by Gov. Andy Beshear.

 

Update as of April 17th, 2020: SBA Paycheck Protection Program

The Paycheck Protection Program is providing Small Businesses with resources they need to maintain their payroll, hire back employees who may have been laid off and help with operational expenses. Here are few things you need to know about the program:

  • All communication will come from your loan officer regarding status of your loan.
  • Be mindful of any phone calls, texts or emails you receive asking for personal financial information. The SBA or U.S. Treasury will not ask for any of this if they were to reach out to you for any reason.
  • If you receive email correspondence from someone other than your loan officer, do not respond. Fraudsters are using official SBA logos to lure those into thinking they’re legitimate.
  • Report any suspected fraud by calling 1-800-767-0385 or reporting online

Additional resources for you to utilize are below.
Small Business Guidance & Resources Information
http://www.sba.gov

 

Update as of April 17th, 2020: Economic Impact Payments

Economic Impact Payments are being disbursed. We’re here for you and want you to be vigilant on safeguarding yourself as well as your financial information. There has been an increase of COVID-19 related scams and fraudulent activity seen worldwide.

Here are a few helpful tips to keep in mind:

  • Be mindful of any phone calls, texts or emails you receive asking for personal financial information. The IRS will not ask for any of this if they were to reach out to you for any reason.
  • Check your accounts often to monitor your activity. This can be done by logging into Digital Banking, calling Telephone Banking, Text Banking or by viewing account balances at one of our ITMs.
  • Sign-up for account alerts in Digital Banking so you can receive text alerts on your account activity
  • The IRS is sending payments according to your recent tax return information on file. If your bank account from that time has changed, your check will be automatically mailed to you from the IRS to the address on file.
  • Check the status of your payment on the IRS website. If your check has not yet processed, you can update your information with the IRS in order to receive it as a direct deposit

Economic Impact Payment Information
https://www.irs.gov/coronavirus/economic-impact-payment-information-center

 

Update as of March 16th, 2020
As developments continue surrounding Coronavirus (COVID-19), we’re here to ensure you that the health and welfare of our employees, customers and communities are a priority. Beginning Tuesday, March 17th all Independence Bank locations will be drive-thru only. If you need to reach us or schedule an appointment please call 1-877-621-1776.

 

Update as of March 13th, 2020
At Independence Bank, our customers, employees and the communities we serve are at the heart of everything we do. Our efforts surrounding the Coronavirus (COVID-19), are focused on you.

Our locations are open and available to serve our customers. If visiting a location, know that we have implemented increased cleaning procedures in high-touch areas and have educated our employees on best practices recommended by the CDC.

You can facilitate virtually any banking need from your desktop or mobile device 24/7, should you choose to exercise more precautions as the development of the Coronavirus continues.

Bank From Home
Digital Banking
Telephone Banking
Text Banking
ATM & ITMs
Transfer Funds
Bill Pay
Person to Person Payments
Remote Check Deposit
External Transfers

Now, our ATMs also function as Interactive Teller Machines (ITMs) in each of our markets. You can make deposits, cash a check, make a loan payment, transfer funds between accounts on your own or with the assistance of an interactive teller with extended hours.

We are diligently monitoring the developments of the virus in accordance with the CDC and will continue to keep the health of our customers, employees and communities at the forefront. We are available to assist you if you need us, as always.

If you should need additional assistance please don’t hesitate to call your nearest Independence Bank location.

 

Important Links:
Centers For Disease Control and Prevention (CDC)
Independence Bank ATM & ITM Locations
Independence Bank Contact-Us

 

Be Mindful of Scams:
Please be mindful of Coronavirus scams that could appear as emails, social media posts, calls, texts or on websites. Always check the validity of the news source. Be wary of any communication that asks you for personal information or donations. For additional information, including how to report scams, please view the press release listed below sent out by Gov. Andy Beshear and Attorney General Daniel Cameron. Full Press Release

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