Dept Of Education Loan Forgiveness

Dept Of Education Loan Forgiveness

The U.S. Small Business Administration issued a one-page application form aimed at simplifying the application process to forgive Paycheck Protection Program loans, as well as newly revised and updated forms to meet the requirements of the latest stimulus legislation. 

Congress approved the COVID-19 relief package last month, which provided $284 billion of funding to small businesses in need of loans. The funds were used to reduce the economic burden of the coronavirus pandemic. The legislation required that the SBA release simplified forms within the first 24 hours of the legislation’s signing into law. This was to make it easier to apply for forgiveness. It also included conditions that would encourage banks in the community to lend more, especially to minority-owned businesses who were unable to obtain loans last year.

Dept Of Education Loan Forgiveness

“The Small Business Administration met the requirements to release the one page form for PPP loan forgiveness by 24 days after the date of enactment of the Consolidated Appropriations Act, 2021,” wrote Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also released more updated forms.”

First Draw PPP Terms of loan forgiveness

Dept Of Education Loan Forgiveness – First Draw PPP loans granted to eligible borrowers qualify for complete loan forgiveness if they do so within the 8 to 24-week period after the disbursement of loan:

  • The same goes for the pay and benefits for employees.
  • The proceeds of the loan can be used to pay payroll costs or other expenses that are eligible.
  • At least 60% of profits go towards payroll costs

Second Draw PPP Terms of Loan Forgiveness

Second Draw PPP loans for eligible borrowers are eligible for loan forgiveness if the loan is paid within an 8– to 24-week period.

  • The First Draw PPP loan requires that the compensation and employee levels are maintained in the identical manner.
  • The loan proceeds can be used to cover the cost of payroll as well as other eligible expenses.
  • Minimum 60% of proceeds go to the cost of payroll
  • When and how do I apply for loan forgiveness

After all loan’s proceeds have been used the borrower is eligible for forgiveness. Borrowers can apply for forgiveness anytime up until the date of maturity of the loan. If the borrower does not apply for forgiveness within 10 months of the last day of the covered period, then PPP loan payments are not deferred any longer, and borrowers must make payment to their PPP lender.

Download Dept Of Education Loan Forgiveness

Gallery of Dept Of Education Loan Forgiveness