SBA Paycheck Protection Program Update

Proudly helping businesses across our communities

First Citizens Bank is proud to have helped nearly 23,000 businesses across our communities secure loans totaling $3.2 billion through the Small Business Administration's Paycheck Protection Program (PPP).

"Taking care of our customers is our promise—it's who we are, especially during times like these", said Chairman and CEO Frank Holding. "I'd like to thank our clients for their patience and trust in us as we've navigated this process and the unusual operating environment. I'd also like to thank our associates for diligently working day and night to help businesses access this PPP funding. It's been an incredible display of teamwork and dedication, and we're grateful for the opportunity to support small businesses and their vital role in the communities we serve."

PPP Loan Forgiveness

We started accepting forgiveness applications from borrowers on Monday, August 24th through our First Citizens Digital Banking® and Business Online Banking (BOB) Advantage® client portals. These online portals were designed to make the submission easier and secure for you and to ensure a more timely processing experience.

Before you take action, we’d like to remind you of the following:

  • New legislation may simplify your application process: We want your experience with the forgiveness process to be as easy as possible. There's the potential for new legislation that will simplify and streamline the forgiveness process for some borrowers, primarily those with loans of $150,000 or less. You may want to consider delaying the submission of your forgiveness application.
  • There's no rush to apply for forgiveness: Given the extension of the payment deferral period under the Paycheck Protection Program Flexibility Act of 2020, you have 10 months from the last day of your covered period to apply for forgiveness.

Submitting Your Forgiveness Application

For borrowers who want to begin the forgiveness process, you can complete the application and submit your required documentation using one of the following online portals:

  • First Citizens Digital Banking
  • BOB Advantage

You’ll be able to log in, see your SBA information pre-filled, and then complete, submit and attest to the information on the standard forgiveness application or the EZ forgiveness application, as well as upload required documentation.

If you experience any challenges submitting your information through the First Citizens Digital Banking or BOB Advantage portal, please reach out to your local First Citizens Bank associate directly for further assistance.

Helpful Resources: Application Instructions and Required Documentation

If you haven't already, we encourage you to review the two SBA forgiveness applications to get an idea of the documentation requirements and determine which application form is appropriate for your situation:

  • Are a self-employed individual, independent contractor or sole proprietor with no employees; OR
  • Did not reduce the salary or hourly wages of any employee by more than 25%, and did not reduce the number or hours of their employees; OR
  • Did not reduce the salary or hourly wages of any employee by more than 25% and experienced reductions in business activity as a result of requirements or guidance related to COVID-19 issued by certain federal agencies.

Both applications give borrowers the option of using the original 8-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period.

Commonly Asked Questions About the Forgiveness Process

1. Can I apply for forgiveness before the end of my covered period? If so, how do I enter my covered period in the application?

While it is acceptable to apply for forgiveness before the end of the 24-week covered period, the covered period entry must still reflect the full 8- or 24-week period, even if all the funds were used in a period less than 24 weeks. The covered period does not end on the date you spent all the PPP proceeds. The SBA will not accept an application without covered periods entered correctly.

Sample dates for clarification:

8-Week Example

24-Week Example

PPP Disbursement Date

4/30

4/30

Covered Period

4/30 to 6/25

4/30 to 10/15

2. Is it necessary to provide all of the required documentation listed on the application instructions?

Yes. For both the standard and EZ forgiveness applications, make sure you provide all of the required documentation up front so we can ensure a more timely processing experience. For a complete listing of required documentation, see below or refer to the standard loan forgiveness application instructions or EZ forgiveness application instructions. We may be unable to approve your loan forgiveness application until we receive all required documentation.

Business Entities (C-Corp, S-Corp, LLCs Taxed as Corporations); Non-Profits (501(c)(3), 501(c)(19)):

  • Bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees; AND
  • Tax forms (or equivalent third-party payroll service provider reports) for periods that overlap with the Covered Period (or Alternative Payroll Covered Period), including: Form 941 or other payroll tax filings reported, or that will be reported, to the IRS; and State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported, or that will be reported, to the relevant state; AND
  • Payment receipts, canceled checks or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that Borrower included in its forgiveness amount calculations; AND
  • For EZ Form Applicants: If Borrower checked the second box on the first page to the EZ Form instructions, Borrower must provide documentation verifying the average number of FTEs on payroll employed by Borrower on January 1, 2020, and the end of the Covered Period

Partnership/LLCs Taxed as Partnership (With Employees):

Partner/Owner Compensation Replacement

  • For each partner/owner, 2019 Schedule K-1 for the periods that overlap with the applicable Covered Period and that report Self-Employment Income (line 14 of Schedule K-1); AND
  • Bank account statements documenting the amount of cash compensation paid to partners/owners

Employee Payroll and Benefits

  • Bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees; AND
  • Tax forms (or equivalent third-party payroll service provider reports) for periods that overlap with the Covered Period (or Alternative Payroll Covered Period), including: Form 941 or other payroll tax filings reported, or that will be reported, to the IRS; and State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported, or that will be reported, to the relevant state; AND
  • Payment receipts, cancelled checks or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that Borrower included in its forgiveness amount calculations

Partnership/LLCs Taxed as Partnership (Without Employees):

  • For each partner/owner, 2019 Schedule K-1 for the periods that overlap with the applicable Covered Period and that report Self-Employment Income (line 14 of Schedule K-1); AND
  • Bank account statements documenting the amount of cash compensation paid to partners/owners

Sole Proprietor/Self-Employed/Independent Contractor/Single Member LLCs (With employees):

Owner Compensation Replacement

  • 2019 Form 1040, Schedule C for the periods that overlap with the applicable Covered Period and that report net profit in line 31 of Schedule C; AND
  • Bank account statements documenting the amount of cash compensation paid to owner

Payroll and Benefits

  • Bank account statements or third-party payroll service provider reports documenting the amount of cash compensation paid to employees; AND
  • Tax forms (or equivalent third-party payroll service provider reports) for periods that overlap with the Covered Period (or Alternative Payroll Covered Period), including: Form 941 or other payroll tax filings reported, or that will be reported, to the IRS; and State quarterly business and individual employee wage reporting and unemployment insurance tax filings reported, or that will be reported, to the relevant state; AND
  • Payment receipts, cancelled checks, or account statements documenting the amount of any employer contributions to employee health insurance and retirement plans that Borrower included in its forgiveness amount calculations

Sole Proprietor/Self-Employed/Independent Contractor/Single Member LLCs (Without employees):

  • 2019 Form 1040, Schedule C for the periods that overlap with the applicable Covered Period and that report net profit in line 31 of Schedule C; AND
  • Bank account statements documenting the amount of cash compensation paid to sole proprietor/self-employed person/owner/independent contractor

What To Expect After Submitting Your Forgiveness Application

Once you submit a complete forgiveness application, First Citizens has 60 days to review your application and issue a decision to the SBA. The SBA then has 90 days to render a final decision and remit the appropriate forgiveness amount, plus any accrued interest.

You'll receive notice from us regarding the final disposition of your forgiveness application and, if applicable, related next steps once we receive the final decision from the SBA.

Again, there is no rush for you to apply, and new PPP-related legislation may be passed that simplifies and streamlines your forgiveness application process. However, we wanted to make it possible for you to submit your application now if you choose to do so.

As always, your local First Citizens Bank associate is available to assist and support you through this process.

First Citizens Bank cannot guarantee forgiveness of your PPP loan, and loan forgiveness is subject in all respects to the PPP regulations implemented from time to time. Forgiveness of the PPP loan is only available for amounts that are used for the limited purposes that qualify for forgiveness under the PPP regulations. Forgiveness of the PPP loan is not automatic, and you must request it. To obtain loan forgiveness, you will be required to provide documentation in accordance with the PPP regulations and attest that the amounts that you are requesting to be forgiven qualify under the PPP regulations. You will remain responsible under the PPP loan for any amounts of principal and interest that are not forgiven. First Citizens Bank will not apply for loan forgiveness for you, and you are responsible for understanding the PPP regulations applicable to loan forgiveness. You should consult with your own legal, accounting and financial advisors when calculating your loan forgiveness amount and when applying for loan forgiveness.

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