Important PPP Loan Dates and Deadlines

June 16, 2020

We want to support our business customers who received a Paycheck Protection Program (PPP) loan by providing information and reminders about the program. The information below is based on guidance from the Small Business Administration (SBA) and reflects recent updates to the program through the Paycheck Protection Program Flexibility Act, which was signed into law on June 5, 2020.

Please note that there are still uncertainties about the program, and the SBA is expected to release additional guidance. Current information can be found on the SBA’s Paycheck Protection Program webpage.

In order to help maximize your loan forgiveness, please keep the following dates and deadlines in mind:

January 1 – March 31, 2020

When determining forgiveness, payroll information from the period of January 1, 2020, to March 31, 2020, is used to compare the number of full-time equivalent (FTE) employees and each employee’s average annual salary or hourly wage.

February 15, 2020

Eligible mortgage interest payments, rent or lease payments, and utility payments (electricity, gas, water, transportation, telephone, or internet access) must be for agreements in force before February 15, 2020. Per the language of the Paycheck Protection Program Flexibility Act, borrowers must be careful to use no more than 40% of the PPP loan for non-payroll cost to qualify for ANY loan forgiveness.

24 Weeks from Loan Funding or December 31, 2020

To be eligible for loan forgiveness, PPP funds must be used for eligible expenses within 24 weeks of the date you received your PPP loan funds, or before December 31, 2020 (whichever is earlier). However, borrowers that received their PPP loan prior to enactment of the Paycheck Protection Program Flexibility Act still have the option to use the initial 8-week covered period.

For payroll purposes only, you have the option to begin the covered period for loan forgiveness on the first day of the next payroll period following the PPP loan disbursement date.

There is some flexibility regarding expenses that were incurred before this covered period but paid during this timeframe, as well as for expenses incurred during the covered period but paid afterward. For details, see the SBA’s revised PPP Loan Forgiveness Application and Instructions or streamlined “EZ” application for eligible borrowers.

June 30 or December 31, 2020

Under the Paycheck Protection Program Flexibility Act, you now have until December 31, 2020 to restore your FTE employment level (but, if you received your PPP loan before this law was enacted, you have the option to continue to use the initial June 30 deadline to meet this requirement if you choose the initial eight-week covered period).

Note that there are exceptions for employees who voluntarily resigned, requested a reduction in hours, declined to be rehired, or were released for cause. Under certain circumstances, businesses that were unable to maintain their FTE employment level may be able to request an exemption to this requirement.

December 31, 2020, is also the date by which you need to restore salaries and hourly wages to near their previous levels (or by June 30, if using the initial eight-week covered period). That is, if you reduced any employee’s average salary or hourly wages by more than 25%, you need to bring them back to within 25% of their previous amount. This does not apply to employees who make more than $100,000.

If you have questions or would like more details, please call your ENB Relationship Manager or our Customer Service Center at (717) 733-4181. As always, you are also encouraged to seek independent accounting and legal advice on decisions that require such professional reviews and to assist you in determining your priorities.

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