Correctional Officer Student Loan Forgiveness

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 to comply with the latest stimulus law. 

The COVID-19 relief package that Congress approved last month renewed the PPP with $284 billion in funds for small businesses that want forgiven loans to help to deal with the effects of economic collapse of the coronavirus epidemic. It also included a requirement that the SBA to issue streamlined forms within 24 days of the bill being adopted to make the application process for forgiveness. The legislation also contained conditions that aim to increase the number of bank loans by community banks, particularly for minority-owned businesses who struggled to get loans last year.

Correctional Officer Student Loan Forgiveness

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs wrote that the Small Business Administration fulfilled the obligation to issue the one-page PPP form loan forgiveness within 24 days from 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 issued more updated forms.”

First Draw PPP Conditions for loan forgiveness

Correctional Officer Student Loan Forgiveness – First Draw PPP loans made to borrowers who are eligible can be granted full loan forgiveness if within the 8-to 24-week period after the disbursement of loan:

  • Employee and compensation levels are maintained
  • The loan funds are used on payroll costs and other eligible expenses; and
  • At least 60% of the proceeds are spent on payroll costs

Second Draw PPP Loan Forgiveness Conditions

Second Draw PPP loans for eligible borrowers are qualified for loan forgiveness if the loan is paid within an 8to 24 week time frame.

  • The First Draw PPP loan requires that the employee and compensation levels be maintained in an exact same way.
  • The loan funds are used on payroll costs and other eligible expenses; and
  • At least 60% of proceeds are used for the cost of payroll
  • When and how do I apply for loan forgiveness

Once all of the loan proceeds have been used, a borrower can apply to be forgiven. The borrower can apply for forgiveness at any time up to the date of maturity. If they do not file for forgiveness within 10 months of the date of expiration of the period covered the PPP loan payments can no longer deferred and borrowers will begin making payment to their PPP lender.

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