Bank Of America Equity Loan Forgiveness

The U.S. Small Business Administration has released a single-page form that aims to simplify the application process for forgiveness of Paycheck Protection Program loans, together with updated and revised forms that meet the requirements of the most recent stimulus legislation. 

The COVID-19 aid package Congress passed last month revived the PPP with $284 billion in funding for small businesses seeking forgivable loans to help them deal with the financial fallout from the coronavirus pandemic. The law required that the SBA issue simplified forms within 24 hours of the legislation’s signing into law. This was done to facilitate the application for forgiveness. It also included conditions to encourage banks in the community to lend more particularly to minority-owned businesses that had difficulty getting loans last year.

Bank Of America Equity Loan Forgiveness

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs and said that the Small Business Administration fulfilled the requirement to publish the one-page form for PPP loan forgiveness within the first 24 hours of the date of enactment in the Consolidated Appropriations Act, 20,21. The article was posted on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also released updated forms.”

First Draw PPP Loan forgiveness terms

Bank Of America Equity Loan Forgiveness – First Draw PPP loans made to eligible borrowers qualify for total loan forgiveness within the 8 to 24-week covered period following the disbursement of loan:

  • It’s the same for pay and benefits for employees.
  • The proceeds of the loan can be used to pay payroll costs or other eligible expenses.
  • Minimum 60% of profits go towards the cost of payroll

Second Draw PPP Loan Forgiveness Terms

Second Draw PPP loans made to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8– to 24-week duration following the loan’s disbursement

  • The First Draw PPP loan requires that the employee and the compensation levels are maintained in the exact same way.
  • The loan proceeds are spent on payroll and other expenses that are eligible and
  • A minimum of 60% of profits are used for the cost of payroll
  • What is the best time to apply for loan forgiveness

When all of the loan funds have been utilized the borrower is eligible to be granted forgiveness. Borrowers are able to apply for forgiveness at any time prior to the maturity date of the loan. Borrowers who don’t request forgiveness within 10 months of the end date of the loan are able to receive loan payments from their PPP lender.

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