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At American State Bank, we are committed to delivering resources and information to help Paycheck Protection Program (PPP) borrowers navigate the loan forgiveness process.  To help provide the quality experience our customers expect, beginning October 1, 2020, American State Bank is implementing a phased approach to accepting and processing PPP loan forgiveness applications based upon the date that a customer’s PPP loan was funded.  We will notify PPP borrowers via email when their PPP loan funding date is eligible to apply.


How to APPLY for PPP Loan Forgiveness with American State Bank

  1. Work directly with your Lender, who took your application for submission of your application. Your Lender will reach out to you directly and invite you to submit your forgiveness application as your submission eligibility window approaches. Your Lender is the individual who accepted your PPP loan application.
  2. You will submit your application along with all supporting documentation once your Lender has notified you to do so. If you decide you would like to submit a forgiveness application to the SBA, you will submit your application along with all required supporting documentation once your Lender has notified you to do so. If you do not plan to submit a forgiveness application, please simply inform your Lender when he or she reaches out to you. You are not required to submit a forgiveness application.
  3. Once your Lender has received and reviewed all supporting documentation needed to apply for forgiveness, your Lender will upload documentation and track your forgiveness request with the SBA.
  4. You will be notified of any updates regarding your application by your Lender.


How to Get Started:

  1. Determine which Forgiveness Application is right for YOU: The SBA has provided three different forgiveness applications: Loan Forgiveness Application Form 3508, 3508EZ, and 3508S. A quick reference chart on the next page allows you to determine if the Forgiveness Application Form 3508EZ can be used. The 3508S application is the new simple application for loans $50,000 and less. Please make sure you have chosen the right application for your specific situation. Lastly, please provide the appropriate documentation for each loan application submission. Your documentation will be necessary in determining your forgiveness amount.  

 PPP Loan Forgiveness Application Selection Tool


You can apply for forgiveness of your Paycheck Protection (PPP) loan using this SBA Form 3508EZ if  one of the three scenarios  below applies to you: 

  • You are a self-employed individual, independent contractor , or sole proprietor who had no employees at the time of the PPP loan application and did not include any employee salaries in the computation of average monthly payroll in the Borrower Application Form (SBA Form 2483).


  • You did not reduce annual salary or hourly wages of any employee by more that 25 percent during the Covered Period or the Alternative Payroll Covered Period compared to the period between January 1, 2020 and March 31, 2020 (for purposes of this statement, “employees” means only those employees that did not receive, during any single period 2019, wages or salary at an annualized rate of pay in an amount more than $100,000):


You did not reduce the number of employees or the average paid hours or employees between January 1, 2020 and the end of the Covered Period. (Ignore reductions that arose from an inability to rehire individuals who were employees on February 15, 2020 if you were unable to hire similarly qualified employees for unfilled positions on or before December 31, 2020.  Also ignore reductions in an employee’s hours that the Borrower offered to restore, and the employee refused.  See 85 FR 33004, 33007 (June 1, 2020) for more details.


  • You did not reduce annual salary or hourly wages of any employee by more than 25 percent during the Covered Period or the compared to the period between January 1, 2020 and March 31, 2020 (for the purposes of this statement, “employees” means only those employees that did not receive, during any single period during 2019, wages at an annualized rate of pay in an amount of more than $100,000):


You were unable to operate during the Covered Period at the same level of business activity as before February 15, 2020, due to compliance with requirements established or guidance issued between March 1, 2020 and December 31, 2020 by the Secretary of Health and Human Services, The Director of the Centers for Disease Control and Prevention, or the Occupational Safety and Health Administration, related to the maintenance of standards of sanitation, social distancing, or any other work or customer safety requirement related to COVID-19.


  1. Please become familiar with the Applications:  We recommend that you begin reviewing the version of the application and application instructions for which you qualify.  


  1. Begin to Gather the Required Supporting Documentation:  Clear and accurate documentation will be instrumental in the forgiveness process. Beginning to compile this documentation now will help expedite the process when submitting the application. It is recommended that borrowers reach out to their lawyers, accountants, or other advisors for help with questions specific to you.     


Frequently Asked Questions: 

Should you have any questions related to the forgiveness process, please reach out to your Lender.  Additionally, please see the resources provided by the U.S Department of Treasury and the SBA on the Treasury website .



Payroll Protection Program


On Friday, March 27, 2020, the Federal stimulus bill in response to COVID-19 virus, known as the CARES Act, was signed into law.  This legislation included the U.S. Treasury and U.S. Small Business Administration (“SBA”) loan program known as the Paycheck Protection Program (PPP).  This program was officially launched on April 3rd with an initial allocation of $349 billion in funds.  By April 16th, the SBA informed its lending partners that the initial funds allocated to the program had been fully committed and that no additional applications would be accepted.  On April 24th, new legislation was signed into law providing an additional $310 billion in funds to the program.

American State Bank was successful in helping over 200 customers with approximately $30MM in funding under round one of the Paycheck Protection Program.  American State Bank is currently accepting applications for future submission to the SBA.  Please see “How to Apply” below for information related to applying for a PPP loan.

Due to the significant demand for the program, it is anticipated that this second round of funding will be exhausted quickly.  As such, submitting an SBA Paycheck Protection Program Borrower Application (SBA  Form 2483) and required supporting documentation does not guarantee approval by the SBA or funding of the SBA loan. 

Paycheck Protection Program Overview

The Paycheck Protection Program (“PPP”) is a temporary expansion of the traditional U.S. Small Business Administration (SBA) 7(a) loan program designed to provide a direct incentive for small businesses to keep workers on their payroll during the COVID-19 pandemic.  The Paycheck Protection Program is a loan program administered by the federal government and facilitated by various lending institutions including American State Bank.

A key benefit of a PPP loan is that a portion, if not all, of the requested loan may be forgiven by the federal government at the end of the eligibility period if certain conditions of the use of funds and other conditions are met.

Please see the most up-to-date information on the PPP Program and the Forgiveness Process on the U.S. Department of Treasury website.


Paycheck Protection Program Forgiveness Process

On June 5, 2020, the President signed into law the Paycheck Protection Program Flexibility Act (“PPPFA”).  As a result, the U.S. Small Business Administration, in consultation with the U.S. Department of Treasury have issued new and revised guidance for the Paycheck Protection Program (“PPP”) impacting loan forgiveness.  The following outlines the key changes provided by the PPPLFA:

  • The Covered Period for loan forgiveness has been extended from eight weeks after the date of loan disbursement to 24 weeks, which provides greater flexibility for borrowers to qualify for loan forgiveness. (Borrowers who have already received PPP loans retain the option to use an eight-week covered period.)
  • The requirement that 75% of loan proceeds and 75% of the forgiveness amount must be spent on payroll has been reduced to 60%, and those borrowers who fail to use 60% of proceeds may remain eligible for partial forgiveness.
  • A safe harbor from reductions in loan forgiveness based on reductions in full-time equivalent employees for borrowers that are unable to return to the same level of business activity the business was operating at before February 15, 2020, due to compliance with requirements or guidance issued between March 1, 2020 and December 31, 2020 by various government entities related to worker or customer safety requirements related to COVID–19.

Forgiveness Application Submission Timing

The SBA has yet to issue guidance outlining the process for banks to submit forgiveness applications to the SBA for approval.  As such, it is recommended that borrowers review and become familiar with SBA Forgiveness application, but we request that applications are not submitted to the Bank until further guidance is issued by the SBA. 

Please see the U.S. Department of the Treasury website.