CARES ACT PAYCHECK PROTECTION PROGRAM - Citi...to use an Alternative Covered Period. The Alternative Covered Period begins on the first day of the first payroll cycle following the

Back to the Top As of Aug. 4, 2020

CARES ACT PAYCHECK PROTECTION PROGRAM Frequently Asked Questions

As of Aug. 4, 2020

OVERALL What is the purpose of the Paycheck Protection Program in the CARES Act?

What are the loan features?

What are the loan terms, interest rates and fees?

Is Citi still accepting PPP applications?

Now that the Covered Period has been extended, can I apply for additional funds?

Now that the SBA has extended the program deadline, can I apply for additional funds?

PPP LOAN ELIGIBILITY What type of business is eligible to apply?

Are any small businesses with over 500 employees eligible to apply?

Can I be ineligible even if I meet the eligibility requirements above?

Have the eligibility requirements changed since the SBA extended the application deadline?

How will my eligibility be verified?

I already have an SBA Loan. Can I apply for a PPP loan?

I haven’t completed my 2019 tax return. Is that a problem?

What about SBA Affiliation Standards?

Do I need to first look for other funds before applying to this program?

Are there any special eligibility rules for financial sector firms, those with other sources of

capital, or businesses owned by large companies with adequate sources of liquidity to

support the business’s ongoing operations?

Are borrower loan files subject to review by the SBA or other governmental agency?

If I was previously declined (by Citi or another institution) can I reapply now?

PPP LOAN APPLICATION How much can I apply for?

Should I include independent contractors as employees for PPP loan calculations?

What information and documents do I need to apply for a PPP loan?

What additional information is needed by Nonprofits to apply for a PPP loan?

What do I need to certify when applying for a PPP loan?

How long does the PPP loan application take?

Are there any fees to apply?


Do I need to pledge any collateral or personally guarantee these loans?

What is the status of my loan?

Why did I get a decline letter?

When approved, how quickly will I get the funds?

I’ve been notified that my loan was approved. Does this mean the funds are guaranteed to

be disbursed?

LOAN FORGIVENESS BASICS How does PPP loan forgiveness work?

How is the forgiveness amount calculated?

What is the Covered Period for loan forgiveness?

Can I choose to have my Covered Period be a timeframe other than 8 or 24 weeks?

What expenses are eligible for loan forgiveness?

What specific components of payroll costs qualify for loan forgiveness?

What specific components of non-payroll costs qualify for loan forgiveness?

What expenses are not eligible for loan forgiveness?

Are benefit payments to those employees who make more than $100,000 per year

forgivable?

Are only costs paid during the Covered Period eligible for forgiveness?

Can I use this loan to help bring back employees who have been laid off?

What will reduce my loan forgiveness amount?

Will my loan forgiveness amount be reduced if I laid off an employee, offered to rehire the

same employee, but the employee declined the offer?

What is the FTE Safe Harbor?

Will my loan forgiveness amount be reduced due a reduction in headcount if I was unable

to operate at the same level of business activity as before February 15, 2020?

What is the Salary/Wage Safe Harbor?

I made a mistake in my initial application. Will that impact my forgiveness amount?

APPLYING FOR LOAN FORGIVENESS Has Citi begun accepting applications for PPP loan forgiveness?

Do I need online access to apply for loan forgiveness through Citi?

How do I apply for loan forgiveness?

When do I need to submit my loan forgiveness application by?

Do I need to wait until the end of my Covered or Alternative Covered Period to submit my

loan forgiveness application?


Can I check the status of my loan forgiveness application after I have submitted it?

Will Citi reach out to me if there is a question about my application or documents are

missing?

Do I need to complete my loan forgiveness application in a single sitting?

What should I do if I need help completing my application?

How long will it take for me to be notified of my loan forgiveness amount?

What if I disagree with Citi’s decision regarding my forgiveness amount?

What is the difference between the PPP Loan Forgiveness Application and the PPP EZ Loan

Forgiveness Application?

What documentation will I be required to submit when applying for forgiveness?

Do I need to complete the Schedule A worksheet to apply for forgiveness through Citi?

LOAN REPAYMENT What’s the repayment process?

Can I pay my loan off before its maturity date?

What happens to my PPP loan after the forgiveness period?

How long will payments on my loan be deferred?


OVERALL

What is the purpose of the Paycheck Protection Program in the CARES Act?

The recently enacted CARES Act establishes a new Paycheck Protection Program, a federally-

guaranteed, low-interest loan program intended to help small businesses keep their

employees working. Small businesses, non-profits and sole proprietorships may be eligible for

low-interest loans with deferred payments and a maturity of two or five years.

What are the loan features?

Streamlined application requirements that can be completed online

No Small Business Administration fees

Deferred payments

Borrowers are eligible for loan forgiveness equivalent to what is spent on covered expenses during the covered period after the loan is originated

What are the loan terms, interest rates and fees?

For any amounts not forgiven, the term for a loan originated before June 5, 2020 will be two

years, although the borrower and lender can agree to extend that term to five years. Any

loans approved after June 5, 2020 will automatically be subject to a five year term.

The interest rate on PPP loans is 1% per annum. There are no loan fees or prepayment fees.

Is Citi still accepting PPP applications?

No, at this time Citi is not accepting PPP applications. While the SBA had extended the

deadline for approving loans to August 8, 2020, Citi stopped accepting any PPP loan

applications after August 3, 2020, to allow sufficient time to process applications and present

them for approval to the SBA.

Now that the Covered Period has been extended, can I apply for additional funds?

No.

Now that the SBA has extended the program deadline, can I apply for additional funds?

No.


PPP LOAN ELIGIBILITY

What type of business is eligible to apply?

Have up to 500 employees, including all employees and the employees of any U.S. and foreign affiliates.

Are a restaurant or hospitality business with up to 500 employees per location

Are a 501(c)(3) organization, a 501(c)(19) veteran organization, or a tribal business concern

Are an independent contractor or sole proprietor

Businesses in certain industries can have more than 500 employees if they meet applicable SBA employee-based size standards for those industries. You can learn more about potential exceptions to the 500-employee limit on the Small Business Administration website.

Are any small businesses with over 500 employees eligible to apply?

A business with more than 500 employees can qualify if it meets the SBA employee-based or

revenue-based size standard corresponding to its primary industry. Go to www.sba.gov/size

for the industry size standards. Additional information can be found in the SBA guidelines on

size standards.

Additionally, a business can be eligible if it meets both tests in SBA’s “alternative size

standard” as of March 27, 2020: (1) maximum tangible net worth of the business is not more

than $15 million; and (2) the average net income after Federal income taxes (excluding any

carry-over losses) of the business for the two full fiscal years before the date of the application

is not more than $5 million.

Can I be ineligible even if I meet the eligibility requirements above?

Business owners will be ineligible if one of the following applies:

Engage in activity that is illegal under federal, state, or local law;

Household employers of employees such as nannies or housekeepers;

An owner of 20 percent or more of the equity of the applicant is incarcerated, on probation, on parole; presently subject to an indictment, criminal information, arraignment, or other means by which formal criminal charges are brought in any jurisdiction; or within the last 5 years, has, with respect to any felony involving fraud, bribery, embezzlement, or a false statement in a loan application or an application for federal financial assistance, or within the last year, for any other felony, has 1) been convicted; 2) pleaded guilty; 3) pleaded nolo contendere; or 4) been placed on any form of parole or probation (including probation before judgment);

You, or any business owned or controlled by you or any of your owners, has ever obtained a direct or guaranteed loan from SBA or any other Federal agency that is currently

http://www.sba.gov/size

https://www.sba.gov/document/support--table-size-standards

https://www.sba.gov/document/support--table-size-standards


delinquent or has defaulted within the last seven years and caused a loss to the government;

Any owner of the business or the business itself is presently involved in any bankruptcy proceeding;

Any other factors established by the SBA apply.

Have the eligibility requirements changed since the SBA extended the application deadline?

No, the eligibility requirements have not changed

How will my eligibility be verified?

We will use the information and documents you provide in your application to verify your

eligibility, how loan funds will be used, the qualifying loan amount and eligibility for loan

forgiveness

I already have an SBA Loan. Can I apply for a PPP loan?

Yes.

I haven’t completed my 2019 tax return. Is that a problem?

No.

What about SBA Affiliation Standards?

For this program, the SBA’s affiliation standards are waived for small businesses (1) in the

hotel and food services industries; or (2) that are franchises in the SBA’s Franchise Directory;

or (3) that receive financial assistance from small business investment companies licensed by

the SBA. Additional guidance may be released as appropriate.

Do I need to look first for other funds before applying to this program?

No. The usual SBA requirement that you try to obtain some or all of the loan funds from other

sources is waived for the PPP program.

Are there any special eligibility rules for financial sector firms, those with other sources of

capital, or businesses owned by large companies with adequate sources of liquidity to

support the business’s ongoing operations?

In addition to reviewing applicable affiliation rules to determine eligibility, all borrowers must

assess their economic need for a PPP loan under the standard established by the CARES Act

and the PPP regulations. Borrowers must certify in good faith that their PPP loan request is

necessary. Borrowers must make this certification in good faith, taking into account their

current business activity and their ability to access other sources of liquidity sufficient to


support their ongoing operations in a manner that is not significantly detrimental to the

business. For example, it is unlikely that a public company with substantial market value and

access to capital markets will be able to make the required certification. Additionally, Hedge

funds and private equity firms are primarily engaged in investment or speculation, and such

businesses are therefore ineligible to receive a PPP loan. The Administrator of the SBA, in

consultation with the Secretary of the Treasury, does not believe that Congress intended for

these types of businesses, which are generally ineligible for section 7(a) loans under existing

SBA regulations, to obtain PPP financing.

Are borrower loan files subject to review by the SBA or other governmental agency?

To further ensure PPP loans are limited to eligible borrowers in need, the SBA has decided, in

consultation with the Department of the Treasury, that it will review all loans in excess of $2

million, in addition to other loans as appropriate, following the lender’s submission of the

borrower’s loan forgiveness application.

If I was previously declined (by Citi or another institution) can I reapply now?

Yes, Citi Small Business Banking, Citi Commercial Bank and Citi Private Bank customers who

were unable to obtain a PPP loan earlier may wish to re-apply, particularly if they now have

additional or corrected documentation that would support a new application. However, there

is no guarantee that your application will be approved by the SBA prior to the allocation of

all available funds, or that your application will qualify for a PPP loan.

PPP LOAN APPLICATION

How much can I apply for?

The maximum loan amount is generally the lesser of 2.5 times a business’s average monthly

payroll during the prior year or $10 million. If you are a seasonal or new business, you will use

different time periods for your calculation.

For purposes of calculating “Average Monthly Payroll,” most applicants will use the average monthly payroll for 2019, excluding costs over $100,000 on an annualized basis for each employee

For seasonal businesses, you can elect to instead use average monthly payroll for the time period between February 15, 2019 and June 30, 2019.

For new businesses, average monthly payroll may be calculated using the time period from January 1, 2020 to February 29, 2020.

Payroll costs will be capped at $100,000 annualized for each employee.


The amount will be calculated using a payroll-based formula.

Step 1: Determine your payroll costs for the last 12 months for employees whose principal place of residence is the U.S.

Step 2: Determine how much compensation was paid to any employees or independent contractors / sole proprietor in excess of $100,000 per year. Subtract this amount from the costs in Step 1.

Step 3: Calculate average monthly payroll costs (divide the amount from Step 2 by 12).

Step 4: Multiply the average monthly payroll costs from Step 3 by 2.5.

Step 5: Add the outstanding amount of an Economic Injury Disaster Loan (EIDL) made between January 31, 2020 and April 3, 2020, less the amount of any “advance” under an EIDL COVID-19 loan (because it does not have to be repaid).

Should I include independent contractors as employees for PPP loan calculations?

No. Independent contractors can apply for a PPP loan on their own.

What information and documents do I need to apply for a PPP loan?

Step 1: Gather records of your payroll costs; all four quarters of Year 2019 Form 941 filings are required, or all Form 941 filings that occurred if business started on or after April 1, 2019. For Sole Proprietors, Form 1099 required.

o For all self-employed applicants with no employees, we need to see a 2020 invoice, bank statement or book of record establishing that the business was in operation on February 15, 2020.

o For all other applicants, we need to see a payroll statement or similar documentation from the pay period that covered February 15, 2020 to establish that the business was in operation and had employees on that date.

Step 2: You are responsible for and will need to attest to removing any employee salary in excess of $100,000 in your loan request

Step 3: Click “Apply Now” to start your application

Step 4: Upload required documents and submit application

Step 5: Receive your confirmation email and complete the electronic contracts sent through DocuSign

What additional information is needed by Nonprofits in order to apply for a PPP loan?

Individuals submitting on behalf of a Nonprofit should identify himself/herself as the 100%

owner.

What do I need to certify when applying for a PPP loan?

As part of your application, you need to certify in good faith that:


Current economic uncertainty makes the loan necessary to support your ongoing operations.

You were in operation on February 15, 2020 and either had employees for whom you paid salaries and payroll taxes or paid independent contractors, as reported on a Form 1099-MISC.

The funds will be used to retain workers and maintain payroll or to make mortgage, lease, and utility payments.

You have not and will not receive another loan under this program from February 15 - December 31, 2020.

You will provide to the lender documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight weeks after getting this loan.

Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments and covered utilities. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs.

All the information you provided in your application and in all supporting documents and forms is true and accurate. Knowingly making a false statement to get a loan under this program is punishable by law.

You acknowledge that the lender will calculate the eligible loan amount using the tax documents you submitted. You affirm that the tax documents are identical to those you submitted to the IRS. And you also understand, acknowledge, and agree that the lender can share the tax information with the SBA’s authorized representatives, including authorized representatives of the SBA Office of Inspector General, for the purpose of compliance with SBA Loan Program Requirements and all SBA reviews.

How long does the PPP loan application take?

This is a streamlined SBA application form and should take no more than 15 minutes.

Are there any fees to apply?

No. There are no application fees.

Do I need to pledge any collateral or personally guarantee these loans?

No collateral is required and there is no personal guarantee requirement. However, if the

proceeds are used for fraudulent purposes, the U.S. government may pursue criminal charges

against you.

What is the status of my loan?


If you previously submitted a PPP loan application to us, please continue to check your email

for updates from Citi on the status of your application. Our call center and branch

representatives will have no additional information on the status of your application.

Why did I get a decline letter?

You will receive a detailed letter setting forth the reason(s) that you were declined.

When approved, how quickly will I get the funds?

If the SBA approves your loan, it will provide a loan authorization number to us, and we will

send you a request to execute a loan note. After you execute and return your loan note, Citi

will fund your loan. Funds will be disbursed within 10 days of final loan approval.

I’ve been notified that my loan was approved. Does this mean the funds are guaranteed to

be disbursed?

If you have received a communication from Citi indicating that your Paycheck Protection

Program loan application was approved by the SBA, your account will be funded once you

have signed your loan note.

LOAN FORGIVENESS

How does PPP loan forgiveness work?

The overarching focus of the Paycheck Protection Program, a part of the CARES Act, is keeping workers paid and employed, so it prioritizes forgiveness for amounts that go to payroll costs. It also limits the amount of non-payroll costs that can be forgiven to 40 percent of the total amount forgiven. This is intended to ensure that the funds available for forgiveness are primarily directed toward payroll protection.

How is the forgiveness amount calculated?

Your PPP loan may be forgiven to the extent you use the proceeds for payroll costs, mortgage interest/rent, and utilities during the covered period after the loan is funded. To receive full forgiveness you will need to provide proper documentation as outlined in the application instructions provided by the SBA. Your forgiveness amount will also be subject to certain reductions if you do not maintain employee salaries or headcount. No more than 40% of the loan forgiveness amount can come from non-payroll costs.

What is the Covered Period for loan forgiveness?


The Covered Period begins on the date of loan disbursement and continues to the earlier of 24

weeks from the disbursement date, or until December 31, 2020. Borrowers whose loans were

originated prior to June 5, 2020 may choose to use an 8 week Covered Period beginning on the

date of loan disbursement.

For payroll costs only, borrowers with a bi-weekly (or more frequent) payroll cycle may elect

to use an Alternative Covered Period. The Alternative Covered Period begins on the first day

of the first payroll cycle following the borrower’s loan disbursement date and lasts for 24

weeks, or until December 31, 2020. Borrowers whose loans were originated prior to June 5,

2020 may choose to use an 8 week Alternative Covered Period.

Can I choose to have my Covered Period be a timeframe other than 8 or 24 weeks?

No. The Covered Period is a 24-week period beginning on the date of your PPP loan disbursement. If your loan was disbursed before June 5, 2020, you may elect to use an 8-week covered period beginning on the date of loan disbursement. No other time period is permitted. However, your use of loan proceeds does not need to be spread out evenly throughout your covered period. For example, if using a 24-week Covered Period, you could use the entirety of your loan proceeds during the first 10 weeks and be eligible for full-forgiveness assuming you used the proceeds for eligible expenses and can provide proper documentation.

What expenses are eligible for loan forgiveness?

Subject to the exclusions listed in the questions below, and assuming proper documentation is provided, payroll costs paid or incurred during the Covered or Alternative Covered Period are eligible for forgiveness. In addition, non-payroll costs paid or incurred during the Covered Period are also eligible for forgiveness.

At least 60% of your PPP loan must be used for payroll costs. This is a minimum threshold and spending on payroll costs up to 100% can still be eligible for forgiveness, however, no more than 40% can be attributable to non-payroll costs.

What specific components of payroll costs qualify for loan forgiveness?

Cash compensation, subject to the limits described below, to U.S.-based employees (including furloughed employees):

o Salary, wages, commissions or similar compensation, including owner compensation o Cash tips or the equivalent (based on employer records of past tips or, in the absence

of such records, a reasonable, good-faith employer estimate of such tips) o Bonuses and hazard pay


o For owner-employees, self-employed individuals, or general partners: wage, commissions, income, or net earnings from self-employment or similar compensation

Non-cash compensation to U.S.-based employees: o Payment for vacation, parental, family, medical, or sick leave o Allowance for separation or dismissal o Payment for the provision of employee benefits consisting of group health care

coverage, including insurance premiums, and retirement o Payments made by the borrower for employer state and local taxes assessed on

compensation of employees; not including taxes withheld from employee compensation

What specific components of non-payroll costs qualify for loan forgiveness?

Interest on mortgage obligations, incurred before February 15, 2020 o Principal payments and prepayments are not eligible for forgiveness

Rent, under lease agreements in force before February 15, 2020

Payments for those utilities listed below, for which service began before February 15, 2020: o Electricity, gas, water, transportation, telephone, and internet access

What expenses are not eligible for loan forgiveness?

Compensation amounts that exceed the below limits: o Employee compensation at an annual salary rate over $100,000 (for a 24-week

covered period any amount over $46,154 per individual, or for an 8-week covered period any amount over $15,385 per individual will not be eligible for forgiveness)

o Owner compensation (owner-employees, a self-employed individual, or general partners) above 8 weeks’ worth of 2019 compensation (capped at $15,385) for an 8-week covered period or above 2.5 months’ worth of 2019 compensation (capped at $20,833) for a 24-week covered period.

Compensation of employees whose principal place of residence is outside of the U.S.

Payments to contractors, as 1099 employees are eligible to apply for their own PPP loans

Taxes withheld or imposed: o From employee compensation o Under chapters 21, 22, and 24 of the IRS code o For federal employment taxes, including the employee’s and employer’s share of

FICA (Federal Insurance Contributions Act) and Railroad Retirement Act taxes

Qualified sick and family leave for which a credit is allowed under sections 7001 and 7003 of the Families First Coronavirus Response Act

Contributions made on behalf of a self-employed individual or a general partner for: o Retirement o Employer health insurance


Are benefit payments to those employees who make more than $100,000 per year

forgivable?

Yes, employer contributions for employee health insurance or retirement plans are forgivable,

even for those employees who make over $100,000 per year. However, contributions for self-

employed individuals, general partners, or owner-employees are not eligible.

Are only costs paid during the Covered Period eligible for forgiveness?

Payroll costs paid during the Covered or Alternative Covered Period are eligible for forgiveness. In addition, payroll costs incurred but not paid during the borrower’s last pay period of the Covered or Alternative Covered period are eligible for forgiveness if paid on or before the next payroll date. Payroll costs are considered paid on the day paychecks are distributed or the borrower originates an ACH credit transaction, and it is considered incurred on the day that the employee’s pay is earned. To be eligible for forgiveness, non-payroll costs must be paid during the Covered Period or incurred during the Covered Period and paid on or before the next regular billing date, even if that date is after the Covered Period. Non-payroll costs incurred prior to the Covered Period, but paid during the Covered Period, are eligible for forgiveness – this includes past due payments. Costs that are both paid and incurred during the Covered Period should only be counted once, and in all instances non-payroll costs can account for no more 40% of the full forgiveness amount.

Can I use this loan to help bring back employees who have been laid off?

Yes. This program rewards borrowers that hire back workers who may have been laid off. Loan forgiveness is based on your ability to maintain or quickly rehire employees, and to maintain salary levels. What will reduce my loan forgiveness amount?

Your loan forgiveness will be reduced if you:

Decrease your full-time employee headcount. You have until the earlier of December 31, 2020 or the date on which you submit your forgiveness application to restore your full-time headcount for any changes made between February 15, 2020 and April 26, 2020.

Decrease salaries and wages by more than 25% for any employee who made less than $100,000 annualized in 2019. You have until the earlier of December 31, 2020 or the date on which you submit your forgiveness application to restore employee salaries or wages that were reduced by more than 25%.


Will my loan forgiveness amount be reduced if I laid off an employee, offered to rehire the

same employee, but the employee declined the offer?

No, your loan forgiveness amount will not be reduced if you make a good faith, written offer

of rehire, and document the employee’s rejection of that offer. Employees and employers

should be aware that employees who reject offers of re-employment may forfeit eligibility for

continued unemployment compensation.

What is the FTE Safe Harbor?

If you reduced your number of FTEs, your forgiveness amount will be subject to a reduction.

However, two separate safe harbors exempt certain borrowers from this reduction.

The first FTE Safe Harbor is described in detail below and pertains to borrowers who were

unable to restore their level of business operations due to compliance with public health

guidelines.

The second FTE Safe Harbor provides an exemption for borrowers who reduced their number

of FTEs but then rehired those employees. If you reduced your number of FTEs during the

period from February 15, 2020 to April 26, 2020 and restored your number of FTEs by the

earlier of the date you submit your forgiveness application or December 31, 2020, your

forgiveness amount will not be reduced.

Will my loan forgiveness amount be reduced due a reduction in headcount if I was unable to

operate at the same level of business activity as before February 15, 2020?

No. If you are unable to return operations to pre-February 15, 2020 levels and can document

that this was due to compliance with requirements related to standards for sanitation, social

distancing, or any other COVID-19 related worker/customer safety requirement, your

forgiveness amount will not be reduced due to a reduction in headcount.

What is the Salary/Wage Safe Harbor?

The Salary/Wage Safe Harbor is designed to promote the restoration of salaries for employees

who make no more than $100,000 annually. Your loan forgiveness amount will be reduced, if,

during the Covered or Alternative Covered Period, you reduced, by 25% or more, the salary of

an employee who makes up to $100,000. However, the Salary/Wage Safe Harbor gives you

the opportunity to recoup this forgiveness reduction by restoring the salary/wage of impacted

employees to their pre-February 15, 2020 levels. If you can document that you restored those

salaries by the earlier of the date that you submit your forgiveness application or December

31, 2020, your forgiveness amount will not be reduced.


I made a mistake in my initial application. Will that impact my forgiveness amount?

That depends on the nature of the error. Loan Forgiveness amounts are determined

independent from your initial application and are based on how you utilized your PPP Loan

proceeds during the Covered and Alternative Covered Period along with your ability to provide

supporting documentation. You must certify that the documents are true and that you used

the forgiveness amount to keep employees on your payroll and to make eligible mortgage

interest, rent, and utility payments. The amount of non-payroll costs that can be forgiven is

limited to 40% of the total forgiveness amount. At least 60% of the loan funds must be used

for your payroll expenses. You may not be eligible for full forgiveness if your payroll expenses

fell below 60%; if you reduced the number of individuals that you employ or the salaries of

your employees; or if you do not provide documentation verifying how you used all loan

funds. In addition, if the SBA determines during their review of your forgiveness application

that you were not eligible for the PPP loan, your loan will not be forgiven.

APPLYING FOR LOAN FORGIVENESS

Has Citi begun accepting applications for PPP loan forgiveness?

Citi is not yet accepting applications for PPP loan forgiveness. The SBA has published two PPP loan forgiveness applications, Form 3508 and Form 3508EZ, along with detailed instructions for each application. Once we are accepting applications, Citi will accommodate borrowers’ applying for forgiveness using the application for which they qualify. Do I need online access to apply for loan forgiveness through Citi?

Yes, Citi’s loan forgiveness application will be accessed through your online Citi account. If you do not already have online access, please refer to the recent emails you received from Citi about how to enroll for an online account.

How do I apply for loan forgiveness?

If you received your PPP loan from Citi, you will apply for loan forgiveness using our digital application. The application will require you to report how you spent your loan proceeds and to provide supporting documentation verifying the number of full-time equivalent employees and their pay rates, as well as payments on eligible mortgage, lease, and utility obligations. You must


certify that the documents are true and that you used the forgiveness amount in the ways you reported.

When do I need to submit my loan forgiveness application by?

Payments on your loan will be deferred until 10 months after the completion of your Covered

Period. If you have an active loan forgiveness application at that time, your payments will

continue to be deferred until the SBA has denied forgiveness or remitted a forgiveness

payment to Citi.

Do I need to wait until the end of my Covered or Alternative Covered period to submit my

loan forgiveness application?

No, you can submit your application prior to the end of your Covered or Alternative Covered

Period. However, loan forgiveness amounts will be based on qualifying expenses and related

documentation that have been incurred or been paid as of the time that you submit that

application – it will not take planned use of loan proceeds into account. Additionally, eligibility

for the full-time employee (FTE) reduction and Salary/Wage reduction Safe Harbors will be

based on employment and salary levels on the earlier of the date you submit your forgiveness

application or December 31, 2020.

Can I check the status of my loan forgiveness application after I have submitted it?

Yes, once you have submitted you application you will be able to login to the loan forgiveness

application portal at any time and view the status of your application.

Will Citi reach out to me if there is a question about my forgiveness application or

documents are missing?

Yes, Citi will notify you via email to check the online application portal where you will be able

to see if any additional information is needed.

Do I need to complete my loan forgiveness application in a single sitting?

No. At any time during the process you can save your application and logout. When you log

back in you will be able to resume your application.

What should I do if I need help completing my application?

There will be an email address provided within the Citi application portal that can be used to

submit questions. In addition, for detailed questions relating to your forgiveness eligibility,

specific documentation requirements, or circumstances unique to your businesses, we

encourage you to review the SBA’s guidance or seek guidance from your advisors.


How long will it take for me to be notified of my loan forgiveness amount?

Citi has 60 days to review your complete application. Once we have completed our review,

you will receive notification of our decision as to the amount of your loan that will be forgiven.

Citi will then submit the application for SBA review. The SBA has 90 days to complete their

review. Following the SBA review, Citi will share the final forgiveness decision.

What if I disagree with Citi’s decision regarding my forgiveness amount?

After Citi makes a decision regarding your forgiveness amount, you have an opportunity to

review that decision. If you disagree with Citi’s decision, you will be able to request

reconsideration of that decision and to submit additional information or documentation

supporting your claim.

What is the difference between the PPP Loan Forgiveness Application Form 3508 and the

PPP Loan Forgiveness Application Form 3508EZ?

The EZ application requires fewer calculations and less documentation. Borrowers eligible to

use the EZ application:

Are self-employed and have no employees; OR

Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; OR

Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.

Citi’s digital application will accommodate borrowers’ applying for forgiveness using either

application.

What documentation will I be required to submit when applying for forgiveness?

You will be required to provide documentation that supports your use of loan proceeds during

the Covered or Alternative Covered Period. Required documentation will differ depending

upon how you used your proceeds and which loan forgiveness application you are using.

Generally speaking, borrowers will need to provide the following types of documentation:

Payroll documentation verifying eligible cash compensation and non-cash benefit payments during the Covered or Alternative Covered Period. Acceptable documentation includes:

o Bank account statements or third-party payroll service provider reports; payroll tax filings; and payment receipts, cancelled checks, or accounts statements documenting contributions to employee health insurance or retirement.


Non-payroll documentation verifying the existence of services/obligations prior to February 15, 2020 and eligible payments during the Covered Period. Acceptable documentation will differ depending upon the type of service/obligation.

o For borrowers using the standard forgiveness application, documentation supporting the number of FTEs during the Covered Period and during the reference period selected by the borrower will be required. Borrowers using the Form 3508EZ Application who indicate that they did not reduce their number of FTEs will need to provide documentation supporting this statement.

In addition to the documentation listed above that you need to submit, you will be required to

retain a number of documents. More details can be found in the SBA Application Instructions

provided at SBA.gov.

Do I need to complete the Schedule A worksheet to apply for forgiveness through Citi?

All borrowers who are using PPP loan forgiveness application Form 3508 will need to complete the Schedule A worksheet (included in the SBA application) or obtain its equivalent (i.e. a report from a third party payroll provider) to ensure they have the needed information to complete their application. Schedule A does not need to be submitted, but borrowers should maintain a copy of it for their records. Borrowers using Form 3508EZ application do not need to complete the Schedule A worksheet.

LOAN REPAYMENT

What’s the repayment process?

You will not have to make any payments during the payment deferment period. However, interest will accrue on your PPP loan during this period. Following the deferment period, which begins on the loan’s approval date, the remaining principal amount of the loan, along with accrued interest at 1% per annum, must be repaid over the remaining term of the loan.

Can I pay my loan off before its maturity date?

Yes. There are no prepayment penalties or fees. A Citi banker can assist with getting this process started; after speaking with a banker you will receive an email statement with your payoff amount. PPP loans accrue interest at 1% per annum. Principal and accrued interest must be paid in full for your loan obligation to be satisfied. In order to repay the PPP loan in full, we recommend that payment be made in the form of certified check, cashier’s check or a federal funds wire transfer. Both wiring and mailing information is provided in the statement of the Payoff Amount. What happens to my PPP loan after the forgiveness period?

https://www.sba.gov/


After the loan forgiveness period for your PPP loan ends, your loan’s principal amount will be calculated as the original loan amount less all expenses that qualified for forgiveness. Following the payment deferment period, which begins on the loan’s approval date, the remaining principal amount of the loan, along with accrued interest at 1% per annum, must be repaid over the remaining term of the loan.

How long will payments on my loan be deferred?

If you have an active loan forgiveness application pending 10 months after the end of your

Covered Period, your deferment period will end once the SBA remits the loan forgiveness

amount to your lender (or notifies your lender that no forgiveness amount is permitted). If

you do not have an active loan forgiveness application pending 10 months after the end of

your Covered Period, your deferment period will end and loan payments will commence.

Documents

CARES ACT PAYCHECK PROTECTION PROGRAM - Citi...to use an Alternative Covered Period. The Alternative Covered Period begins on the first day of the first payroll cycle following the