Biden College Loan Forgiveness

Biden College Loan Forgiveness

The U.S. Small Business Administration has released a 1-page form that makes it easier to apply for the cancellation of Paycheck Protection Program loans. The form is also updated with new forms that comply with the current stimulus legislation. 

The COVID-19 aid package Congress passed last month revived the PPP with $284 billion of financing for small-scale businesses looking for forgiveness loans to help them to deal with the effects of economic collapse from the coronavirus pandemic. The law requires that the SBA release simplified forms within the first 24 hours after the bill’s passage into law. This is to simplify the process of applying for forgiveness. Additionally, it included conditions to encourage community banks to make more loans, especially to minority-owned businesses who had a difficult time getting loans last year.

Biden College Loan Forgiveness

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, wrote that the Small Business Administration fulfilled the requirement to issue the one-page form for PPP loan forgiveness within 24 hours from the date of enactment under the Consolidated Appropriations Act, 20,21. This was on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also issued additional updated forms.”

Forgiveness terms in the initial draw of PPP loans

Biden College Loan Forgiveness – First Draw PPP loans made to borrowers who are eligible can be granted total loan forgiveness within the 8 to 24-week covered period following loan disbursement:

  • The levels of compensation and employee pay are ensured
  • The loan proceeds are spent on payroll expenses and other expenses that are eligible and
  • A minimum of 60% of the proceeds go to the cost of payroll

Second Draw PPP Loan Forgiveness Conditions

Second Draw PPP loans granted to borrowers who are eligible can be granted total loan forgiveness if they do so during the 8to 24-week time period after loan payment:

  • The levels of compensation and employee pay are kept in the same way as required for the First Draw PPP loan
  • The proceeds of the loan can be used to cover payroll costs or other eligible expenses.
  • A minimum of 60% of proceeds are spent on payroll costs
  • How and when to apply for loan forgiveness

When all of the loan’s proceeds have been used the borrower is eligible to be granted forgiveness. Borrowers are able to apply for forgiveness at any time prior until the date of maturity of the loan. If they do not file for forgiveness within 10 years of the date of expiration of the time period that was covered and the loan is not renewed, PPP loans are no longer deferred, and the borrower will be required to make loan payments to their PPP lender.

Download Biden College Loan Forgiveness

Gallery of Biden College Loan Forgiveness


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