Northern Bank PPP Application and Forgiveness

We are here to help our customers overcome the obstacles that stand in the way of their goals and persevere through trying times.

Aiming to help small businesses who have been severely impacted by Coronavirus.

For more than 60 years, Northern Bank has been a trusted partner and source of strength for our communities and customers we serve. We have earned the trust and confidence of our clients by working diligently and collaboratively with them when they face both challenges and opportunities.

The coronavirus pandemic presents new and different challenges for all of us, but as always, we are here to help our customers overcome the obstacles that stand in the way of their goals and persevere through trying times.

For current Northern Bank clients

Our PPP application portal is now open for first and second draw PPP loans (as well as forgiveness applications).

If resources permit, we may open the portal for new clients in the future.

To be complete your application for a first or second draw PPP, you will need to gather the relevant documentation for 2019 or 2020, which may include:

  • IRS Form 941s or 944s and quarterly unemployment tax forms (or equivalent payroll processing records
  • Evidence of employee retirement and group insurance contributions
  • IRS Form 1040 Schedule C (sole proprietors/independent contractors)
  • IRS Form 1065 K-1 (partnerships)
  • Payroll statement or similar record showing business was in operation on Feb. 15, 2020
  • Records showing a 25% drop in gross receipts from 2019 to 2020 (quarterly financials, bank statements, or annual federal tax returns)

Not all documents are relevant for each borrower.

There is a large amount of information to share about the Paycheck Protection Program. Below is a breakdown of what is currently available. Feel free to check back regularly for status updates.


First Draw PPP

Businesses (including sole proprietors and independent contractors) and non-profits that have yet to receive an initial or “first draw” PPP loan now have an opportunity to obtain one, through March 31, 2021.

Loan Amount

2.5 times average monthly payroll with a $10 million maximum

Maximum aggregate amount of first draw PPP loans for borrowers that are majority owned by a common parent is $20 million.


Have not yet obtained a PPP loan

500 or fewer employees

Restaurants and hotels (NAICS code beginning in “72”) with 500 or fewer employees per physical location

Rules that aggregate affiliated borrowers when determining eligibility are waived for hotels, restaurants and franchisees

Second Draw PPP

Borrowers who received a first draw PPP loan may be eligible to receive a second PPP loan, through March 31, 2021.

Loan Amount

2.5 times average monthly payroll (3.5 times for restaurants and hotels) with a $2 million maximum

Maximum aggregate amount of second draw PPP loans for borrowers that are majority owned by a common parent is $4 million.


Must use entire amount of first draw PPP loan (including any increase) on eligible expenses prior to the disbursement of the second draw

300 or fewer employees

Restaurants and hotels with 300 or fewer employees per physical location

Rules that aggregate affiliated borrowers when determining eligibility are waived for hotels, restaurants and franchisees

At least a 25% drop in gross receipts from 2019 to 2020 (either on quarterly or yearly basis) – forgiven first draw PPP funds do not constitute gross receipts

Not owned 20% or more by a Chinese or Hong Kong entity; no director can be a resident of China

Increase on First Draw PPP

Under narrow circumstances, borrowers that received a first draw PPP loan, can request an increase of the loan amount where the loan has not been forgiven; and

  • Partnership loan amount did not use partner compensation (i.e., only relied upon partnership’s employees’ payroll costs);
  • Seasonal employer that could have a higher loan amount based on new rules;
  • Borrower repaid, in full or in part, a first draw PPP loan; or
  • Borrower did not accept full amount of first draw PPP.

Allowable Expenses

In addition to payroll costs, mortgage interest, rent, and utilities, both first and second draw loans can be used for:
Operation Expenditures

Payments for business software or cloud computing service for operational needs.

Property Damage Costs

Property damage caused by public disturbances in 2020 that were not covered by insurance.

Supplier Costs

Payments to suppliers for goods essential to operations pursuant to contract in place before PPP loan is made.

Worker Protection Expenditures

Payments for PPE or business adaptations to comply with COVID-19-related governmental regulations.

New law has also clarified that “payroll costs” include group life, disability, vision, and dental insurance.

SBA PPP Forgiveness Updates

Simplified Forgiveness Application

For loans $150,000 or less

  • Only need to submit a one-page certification attesting to the accuracy of information provided and that borrower complied with requirements of Program.
  • Borrowers do not need to submit additional supporting documentation (but must retain such documentation).
  • SBA is working on the simplified forgiveness application. This is not available yet.
Economic Injury Disaster Loan (EIDL)

Advances will no longer be deducted from forgiveness amount

  • For borrowers who already have a post-forgiveness PPP balance as a result of an EIDL advance deduction, the SBA will automatically remit a reconciliation payment to the bank along with interest to the remittance date.
  • The bank will notify borrowers if the SBA remits a reconciliation payment on their PPP loan. If the amount remitted to the bank exceeds the remaining principal balance of the PPP loan (because the borrower made a payment on the loan), the bank will remit the excess amount, including accrued interest paid by the borrower, to the borrower.

Northern Bank Forgiveness Portal

Northern Bank has created a portal to allow borrowers to submit all of the documents needed to process their SBA PPP forgiveness application. It mirrors the information laid out in the SBA’s PPP forgiveness application. As a reminder, in order to know what information you need to apply, you must read the full instructions and FAQs provided by the SBA before logging in to the application portal. We recommend consulting with your attorney and/or accountant for advice on your application.

How-To Apply Guides

The following How-To Apply Guides are for Northern Bank clients to walk you through all of the steps when applying for PPP loan forgiveness through our portal:

How to Apply Guide

Form 3508

Standard application

Download Guide arrow-right icon
How to Apply Guide

Form 3508S

For borrowers with PPP loans of $50,000 or less

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How to Apply Guide

Form 3508EZ

For borrowers who did not reduce employee levels, wages or hours; or for borrowers who are self-employed with no employees

Download Guide arrow-right icon

Additional Changes Made to PPP Loans

Improved tax

Business expenses paid with PPP loan proceeds (first or second draw) are tax-deductible, even if borrower receives full forgiveness (assuming expenses are otherwise deductible).

New definition for “seasonal employer”

Business that does not operate for 7 or more months per year, or during preceding calendar year, business had gross receipts for any 6-month period that were 33.33% or less than the other 6 months.

Time period used to calculate PPP loan amount

Borrowers can use average monthly payroll costs for 2019, 2020 or last 12 months (with some exceptions).

New entities

Housing coops, IRS 501(c)(6) entities, and direct marketing organizations are now eligible for PPP loans.

Extension of Debit Relief Program Under Section 1112 of CARES Act

The SBA will make additional principal and interest payments on certain SBA loans, including Section 7(a) loans. Below are the current parameters set forth in the Economic Aid Act (subject to change based on SBA guidance):

  • In addition to the six months of first round payments on covered loans approved before March 27, 2020 (includes loans on deferment), the SBA will make 3 months of second round payments beginning February 1, 2021. For borrowers in certain industries that have been substantially impacted by the COVID-19 pandemic (including restaurants), the SBA will make 5 additional second round payments, for a total of 8 second round payments.
  • For covered loans approved from February 1, 2021 through September 30, 2021, the SBA will make 6 months of second round payments. If the SBA determines that funds are available, it may make second round payments on covered loans approved from March 27, 2020 through September 27, 2020.
  • No second round payments will be made on loans approved between September 28, 2020 and January 21, 2021.
  • Monthly payments made by the SBA will be capped at $9,000 for payments on most loans – excess over $9,000 is the responsibility of the borrower.
  • Payments made on 7(a) loans are not taxable.
EIDL Loans and Advances

(This is not a Northern Bank program.)

Under the Economic Aid Act, additional funds have been allocated for Economic Injury Disaster Loan grants or advances, up to $10,000 per business, through December 31, 2021. The SBA will also make available targeted EIDL advances to businesses in low-income communities that have suffered an economic loss greater than 30% (and employ not more than 300 employees). Please check the SBA’s website for more information on these programs.

Grants for Shuttered Venue Operators

(This is not a Northern Bank program)

The recent Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act includes a temporary SBA grant program for “Shuttered Venue Operators.” Eligible entities may receive a grant equal to 45% of 2019 gross revenue, up to $10 million. Eligible entities will apply directly to the SBA, which has yet to issue rules and guidance on the Program. The criteria for eligible entities are very specific and should be reviewed closely.

Below is a summary of the Program based on the Economic Aid Act:

Eligible entity types:

  • Live venue operator or promoter; theatrical producer; or live performing arts organization operator;
  • Museum operator;
  • Motion picture theater operator; and
  • Talent representative.

Eligibility criteria:

  • Fully operational on February 29, 2020;
  • 25% gross earned revenue drop (from any quarter in 2019 to corresponding quarter in 2020);
  • Not publicly-owned or controlled;
  • Cannot have received more than 10% of 2019 gross revenue from federal funding;
  • Entity and owners/controlling entities do not own or operate venues/locations in more than one country or more than 10 states;
  • Did not employ more than 500 employees as of February 29, 2020;
  • Cannot receive first or second draw PPP loan (on or after December 27, 2020);
  • Intention to resume regular operations;
  • Certification of need based on economic conditions.

Grant size:

  • 45% of gross 2019 revenue if in operation on January 1, 2019; if not, 6 times average monthly gross revenue during 2019;
  • Maximum grant = $10 million.

Use of funds:

  • Costs incurred March 1, 2020 through December 31, 2021 (or June 30, 2022 for supplemental grants).
  • Allowable expenses: payroll, rent, scheduled mortgage payments, scheduled debt payments, worker protection costs, utilities, payments to independent contractors, ordinary and necessary business expenses (maintenance, administrative, operating leases, state and local taxes, insurance).


  • Eligible entities will be treated as independent, non-affiliated entities.
  • Two 14-day priority application periods for entities that had a 90% or 70% drop in revenue from April through December 2019 to same period in 2020.
  • Not more than 5 entities that are affiliated can receive grant.
  • Recipient must return any funds not used for eligible expenses within 1 year of disbursement.
  • Supplemental grants may be available.

Important Reminders

  • Terms and conditions are subject to change.
  • Check back for updates.

Be aware and protect yourself from scams

Northern Bank will not ask for confidential information—such as your name, password, PIN or other account information—if we reach out to you. See the Federal Trade Commission’s advice.

*All loans are subject to other requirements and availability of funds under the SBA program. Funds are limited.

**This information is accurate and updated as of 1.21.2021. Terms and conditions are subject to change.

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