The U.S. Small Business Administration released a one-page form aimed at simplifying the process of applying for the forgiveness of Paycheck Protection Program loans, along with newly updated and revised forms that conform to the requirements of the most recent stimulus legislation.
Congress approved the COVID-19 relief plan last month that included $284 billion of financing to small businesses that needed loans. The money was intended to mitigate the economic effects of the coronavirus outbreak. The package also mandated the SBA to issue streamlined forms within 24 days after the legislation was adopted to make the procedure of applying for forgiveness. The legislation also contained conditions that aim to increase the number of loans from community banks, specifically for minority-owned companies that were unable to obtain loans in the past.
“The Small Business Administration met the requirement to issue the one page form for loan forgiveness under the PPP within 24 days of the date of enactment the Consolidated Appropriations Act, 2021,” wrote Ed Zollars who is a partner of Thomas, Zollars & Lynch CPAs, on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also published more updated forms.”
Forgiveness terms for the first draw of PPP loans
American Education Services Teacher Loan Forgiveness – First Draw PPP loans granted to eligible borrowers qualify for complete loan forgiveness if they do so within the 8 to 24-week covered period following loan disbursement:
- It’s the same for employee compensation and the.
- The loan funds are used on payroll and other eligible expenses; and
- Minimum 60% of funds go to the cost of payroll
Second Draw PPP Terms of Loan Forgiveness
Second Draw PPP loans granted to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8to 24-week duration following the loan’s disbursement
- Employee and compensation levels are maintained in the same way as required for the First Draw PPP loan
- The loan proceeds could be used to pay for expenses for payroll or other expenses that are eligible.
- At least 60% of profits go towards expenses for payroll
- When and how do I apply for loan forgiveness?
After all loan funds have been utilized The borrower may apply to be forgiven. Borrowers are able to apply for forgiveness at any time prior until the date of maturity of the loan. Borrowers who do not request forgiveness within 10 months of the expiration date of the loan are eligible to receive loan payments from their PPP lender.
Download American Education Services Teacher Loan Forgiveness
Gallery of American Education Services Teacher Loan Forgiveness
