CMCU is closed on Monday, January 18, 2021, in honor of Martin Luther King Jr. Day

SBA Paycheck Protection Program (PPP)

PPP 2nd Draw Loans (January - March 2021)

Learn more about the Paycheck Protection Program launching in January 2021.

PPP Forgiveness (April - August 2020)

If you applied for a PPP loan with CMCU during 2020, learn more about the forgiveness documentation to upload.


SBA PPP loans are serviced through Central Minnesota Credit Union

This means that all correspondence will be through Central Minnesota Credit Union, NOT SBA. Please be on alert for phishing attempts by fraudsters. There have been reports of applicants receiving fake correspondence from the SBA. If you have any questions regarding communications about your accounts, please contact CMCU directly.

 

PPP Second Draw Loans

January - March 2021

The Paycheck Protection Program (PPP) now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP Loan with the same general loan terms as their First Draw PPP Loan.

Second Draw PPP Loans can be used for the following:

  • Help fund payroll costs, including benefits
  • Pay for mortgage interest
  • Rent
  • Utilities
  • Worker protection costs related to COVID-19
  • Uninsured property damage costs caused by looting or vandalism during 2020 and certain supplier costs and expenses for operations.

Targeted Eligibility

A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
  • Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

How and When to Apply

SBA has not yet opened up the program for applications.  CMCU will link our platform and notify our membership via email once SBA’s platform for loan requests becomes available.   

Second Draw PPP loans are available through March 31, 2021.

Full Forgiveness Terms

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 percent of the proceeds are spent on payroll costs.

Maximum Loan Amount

For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million.

Increased Assistance for Accommodation and Food Services Businesses

For borrowers in the Accommodation and Food Services sector, the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.

Apply Online


Stay tuned for an online application.
If you have questions, call our dedicated business team phone line: (833) 267-7321


First Draw PPP Loans

Eligible applicants that did not receive a PPP loan prior to August 8, 2020, will now have the ability to apply for a PPP First Draw Loan on or before March 31, 2021.

  • Eligibility for PPP loans has been revised to include additional eligible types of entities.
  • Covered eligible expenses have also been expanded and now includes the following: payroll costs, rent, mortgage interest, utilities, operations expenditures, property damage costs, supplier costs, and worker protection expenditures.
  • Certain borrowers may request an increase to their original PPP loan amount.

First Draw PPP Loan Increases

Certain existing PPP borrowers may be eligible to request an increase to their original PPP loan amount.  Further guidance will be forthcoming from SBA on the eligibility and process.

Who Can Apply for PPP First and Second Draw Loans

  • Business entities (e.g., partnerships, corporations, LLCs)
  • Sole proprietors, independent contractors, self-employed individuals
  • 501(c)(3)
  • 501(c)(6)
  • 501(c)(19) Veterans organization
  • Tribal business, and
  • Housing cooperatives, destination marketing organizations, and eligible news organizations.

Must comply with size standards, eligibility criteria, and certain limitations.

PPP Forgiveness

April - August 2020

We at Central MN Credit Union understand loan forgiveness for your recent Paycheck Protection Program (PPP) loan is important to your business.

If you received your PPP loan through Central MN Credit Union, you will need to submit your request through us as well. If your existing PPP loan is less than $150,000 and you have not applied for forgiveness of the loan, please wait to apply. The recent legislation that passed includes an even simpler form of forgiveness that only requires you to submit a one-page document to your lender, attesting that the funds were used appropriately. This new document has to be created by SBA yet, and we will have a link on our website once it is ready.

Upload Forgiveness Documentation

If you have questions, call our dedicated business team phone line: (833) 267-7321

Forgiveness Application: Documentation Required

Sole Proprietorships with No Employees

Payroll Documentation

  • 2019 Schedule C or F
  • Bank Statement from February of 2020

NOTE: Separate payments for health insurance, retirement, or state or local taxes are NOT eligible for additional loan forgiveness.

 

Non-Payroll Documentation
(If any other eligible expenses are being used to attain 100% forgiveness)

  • Business mortgage interest payments
    • Copy of lender amortization schedule and receipts or cancelled checks verifying eligible payments from the Covered Period;
      OR
    • Lender account statements from February 2020 and the months of the Covered Period through the month after the end of the Covered Period verifying interest amounts and eligible payments.
  • Business rent or lease payments
    • Copy of current lease agreements and receipts or canceled checks verifying eligible payments from the Covered Period;
      OR
    • Lessor account statements from February 2020 and from the Covered Period through the one month after the Covered Period verifying eligible payments.
  • Business utility payments
    • Copy of invoices from February 2020 and those paid during the Covered Period and receipts of cancelled checks or account statements verifying those eligible payments.

 

Entities & Sole Proprietorships With Employees

Payroll Documentation:

  • Payroll report prepared by 3rd party
  • 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 (PPP Schedule A, lines (6) and (7)).
  • Tax forms – quarterly 941 report + State unemployment tax filing (filed or will be reported)

OR

  • Internally prepared payroll information
  • Bank statements for the reporting period documenting the amount of cash compensation paid to employees with expenses clearly notated on statements (Highlighted).
  • Schedule C or F (if a sole prop and have employees)
  • Tax forms – quarterly 941 report + State unemployment tax filing (filed or will be reported)
  • 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 (PPP Schedule A, lines (6) and (7)).

Non-Payroll documentation:
(if any other eligible expenses are being used to attain 100% forgiveness)

  • Business mortgage interest payments:
    • Copy of lender amortization schedule and receipts or cancelled checks verifying eligible payments from the Covered Period
      OR
    • Lender account statements from February 2020 and the months of the Covered Period through the month after the end of the Covered Period verifying interest amounts and eligible payments.
  • Business rent or lease payments:
    • Copy of current lease agreements and receipts or canceled checks verifying eligible payments from the Covered Period;
      OR
    • Lessor account statements from February 2020 and from the Covered Period through the one month after the Covered Period verifying eligible payments.
  • Business utility payments:
    • Copy of invoices from February 2020 and those paid during the Covered Period and receipts of cancelled checks or account statements verifying those eligible payments.

While CMCU may have some of these documents on file, the SBA requires you, as the borrower, to supply the documents to validate your expenses.

Notes on payroll documents:

Payroll Reports should include all periods overlapping the 24-week covered period (or 8-weeks if selected), and show figures for each of the following eligible costs:

  • Cash compensation;
  • Employer contributions for employee health insurance;
  • Employer contributions to employee retirement plans; and 
  • Employer state and local taxes assessed on employee compensation.

It is preferred if the report shows separate cash compensation figures for: 

  • Employees who received compensation at an annualized rate <=$100,000 for all pay periods in 2019; and 
  • Employees who received compensation at an annualized rate >$100,000 for all pay periods in 2019
    [For Form 3508EZ, there is no need to separate employees by 2019 compensation level.]

This detail helps Central MN Credit Union validate the line item figures shown on the forgiveness application forms.  

Cash Compensation:

  • Eligible cash compensation includes: gross salary, gross wages, gross tips, gross commissions, paid leave (vacation, family, medical or sick leave), and allowances for dismissal or separation.  This may include bonus; hazard pay; and salaries to furloughed employees.
  • Do not include compensation in excess of an annual salary of $100,000 annualized, as prorated for the covered period.  Therefore, the payroll schedule should show no employee with more than $46,154 in compensation if selecting the 24-week period (or $15,385 for the 8-week period, if eligible and selected).
  • Do not include payments to independent contractors, or compensation to employees whose principal place of residence is outside the US; or qualified sick and family leave wages for which a credit is allowed under sections 7001 and 7003 of the Families First Coronavirus Response Act.

Employer-paid state and local taxes assessed on employee compensation:

  • Payroll reports should also show total amount paid by the borrower for employer state and local taxes assessed on employee compensation (e.g., SUI - state unemployment insurance tax).

Note on full-time equivalency (FTE):

FTE counts both full-time (FT) and part-time (PT) employees. An FT employee is counted as 1.0 FTE, and a PT employee is counted by average number of hours per week divided by 40. For example, a PT employee working 32 hours would count as 0.8 FTE. SBA also offers a simplified method that assigns all PT employees as 0.5, if that is preferable.

PPP Frequently Asked Questions

You should use at least 60% of the proceeds from these loans on payroll costs, including benefits, and up to 40% on Interest on mortgage obligations, rent, and utilities, for which service began before February 15, 2020.

Payroll costs include:

  • Salary, wages, commissions, or tips (capped at $100,000 on an annualized basis for each employee);
  • Employee benefits including costs for vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payments required for the provisions of group health care benefits including insurance premiums; and payment of any retirement benefit;
  • State and local taxes assessed on compensation; and
  • For a sole proprietor or independent contractor: wages, commissions, income, or net earnings from self-employment, capped at $100,000 on an annualized basis for each employee.

You will owe money when your loan is due if you use loan proceeds for anything other than payroll costs, mortgage interest, rent, and utilities payments within the first 24 weeks after getting the loan. 60% of the loan proceeds are to be used for eligible payroll costs and up to 40% for eligible non-payroll costs.

  • Your loan forgiveness may be reduced if you decrease your full-time employee headcount and if you decrease salaries and wages.
  • You have until December 31, 2020 to restore your full-time employment and salary levels for any changes made between February 15, 2020 and April 26, 2020.

You can submit a request to the lender that is servicing the loan. The request will include documents that verify the number of full-time equivalent employees and pay rates, as well as the payments on eligible mortgage, lease, and utility obligations. You must certify that the documents are true and that you used the forgiveness amount to keep employees and make eligible mortgage interest, rent, and utility payments. The lender must make a decision on the forgiveness within 60 days.

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