2022 Loan Forgiveness Program

2022 Loan Forgiveness Program

The U.S. Small Business Administration has released a 1-page form which makes it simpler to request forgiveness of Paycheck Protection Program loans. It also includes newly revised forms that comply with the most recent stimulus legislation. 

The COVID-19 aid package Congress adopted last month revived the PPP with $284 billion of funds for small businesses that want forgiveness loans to help them deal with the financial fallout from the coronavirus outbreak. It included a requirement for the SBA to issue simplified forms within 24 days of the legislation being adopted to make the procedure of applying for forgiveness. The legislation also contained conditions designed to facilitate more bank loans by community banks, particularly for minority-owned businesses that had trouble getting loans in the past.

2022 Loan Forgiveness Program

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs stated that the Small Business Administration fulfilled the requirement to issue the PPP form, which is one page long, for loan forgiveness within 24 days of the date of the enactment of the Consolidated Appropriations Act, 20,21. The article was posted on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also published additional updated forms.”

First Draw PPP Loan forgiveness terms

2022 Loan Forgiveness Program – For eligible borrowers, First Draw PPP loans can be qualified for loan forgiveness. This applies if the loan disbursement occurs within an 8 to 24-week period.

  • Pay and worker levels are ensured
  • The loan proceeds can be used to pay the cost of payroll as well as other eligible expenses.
  • A minimum of 60% of the funds go to payroll costs

Second Draw PPP Conditions for loan forgiveness

Second Draw PPP loans to qualified borrowers can be qualified for loan forgiveness when the loan is repaid within an 8to 24 week time frame.

  • The First Draw PPP loan requires that the compensation and employee levels are maintained in the identical manner.
  • The proceeds of the loan could be used to pay for expenses for payroll or other eligible expenses.
  • At least 60% of funds go to payroll costs
  • How do I apply for loan forgiveness and the time to apply

Once all of the loan funds have been utilized the borrower is eligible for forgiveness. Borrowers can apply for forgiveness at any time prior to the maturity date of the loan. If the borrower does not apply for forgiveness within 10 months of the last day of the period covered, then PPP loans are no longer deferred, and the borrower will be required to make loan payments to their PPP lender.

Download 2022 Loan Forgiveness Program

Gallery of 2022 Loan Forgiveness Program


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