California Ppp Loan Forgiveness

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

The COVID-19 relief plan that Congress approved last month renewed the PPP with $284 billion in funds for small businesses that want 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 24 hours after the bill’s passage into law. This was to make it easier to apply for forgiveness. Additionally, it included conditions to encourage community banks to lend more specifically to minority-owned companies who had a difficult time getting loans last year.

California Ppp Loan Forgiveness

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

First Draw PPP Loan forgiveness terms

California Ppp Loan Forgiveness – First Draw PPP loans made to eligible borrowers qualify for total loan forgiveness during the 8- to 24 week period that follows the disbursement of loan:

  • The levels of compensation and employee pay are kept at a constant level.
  • The loan proceeds are used on payroll expenses as well as other expenses eligible for reimbursement; and
  • At least 60% of funds go to expenses for payroll

Second Draw PPP Loan forgiveness terms

Second Draw PPP loans given to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8to 24 week time period after loan disbursement:

  • The levels of compensation and employee pay are maintained in the same manner as required for the First Draw PPP loan
  • The loan funds can be used to pay expenses for payroll or other eligible expenses.
  • A minimum of 60% of profits are used for the cost of payroll
  • How do I apply for loan forgiveness and when to apply

When all of the loan proceeds have been used, a borrower can apply to be forgiven. Borrowers are able to apply for forgiveness any time up until the date of maturity of the loan. If they do not file for forgiveness within 10 months after the last day of the time period that was covered, then PPP loan payments are not deferred any longer, and borrowers must make loan payments to their PPP lender.

Download California Ppp Loan Forgiveness

Gallery of California Ppp Loan Forgiveness

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