The U.S. Small Business Administration released a one-page form designed to make it easier for applicants to complete the application process to forgive Paycheck Protection Program loans, along with newly updated and revised forms to comply with the most recent stimulus legislation.
Congress approved the COVID-19 relief package last month that offered $284 billion in funding to small businesses in need of loans. The money was intended to mitigate the economic effects of the coronavirus outbreak. The law requires that the SBA release simplified forms within 24 hours of the signing into law. This was done to make it easier to apply for forgiveness. The legislation also contained conditions that would encourage community banks to make more loans specifically to minority-owned companies who had a difficult time getting loans last year.
Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs said that the Small Business Administration fulfilled the obligation to issue the one-page form for PPP loan forgiveness within 24 hours from the date of enactment in the Consolidated Appropriations Act, 20,21. This was on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also released new forms.”
Forgiveness terms for the initial draw of PPP loans
Department Of Justice Mortgage Loan Forgiveness – For borrowers who are eligible First Draw PPP loans are eligible to be forgiven. This happens if the loan disbursement occurs within an 8 to 24-week period.
- The same goes for the employee compensation and the.
- The proceeds of the loan can be used to pay expenses for payroll or other expenses that are eligible.
- Minimum 60% of proceeds go to the cost of payroll
Second Draw PPP Terms of Loan Forgiveness
Second Draw PPP loans for eligible borrowers are eligible for loan forgiveness when the loan is paid within an 8– to 24 week time frame.
- The First Draw PPP loan requires that the employee and compensation levels are maintained in the identical manner.
- The loan proceeds can be used to pay for payroll costs or other expenses that are eligible.
- At least 60% of profits go towards payroll costs
- How do I request loan forgiveness and the time to apply
A borrower may apply for forgiveness only after all loan proceeds to which the borrower has applied for forgiveness have been used. Borrowers can request forgiveness at any time until the loan’s maturity date. Borrowers who do not request forgiveness within 10 months after the date they will be able to repay the loan are able to receive the loan payment from their PPP lender.
Download Department Of Justice Mortgage Loan Forgiveness
Gallery of Department Of Justice Mortgage Loan Forgiveness
