The U.S. Small Business Administration has released a form of one page that makes it easier to apply for the cancellation of Paycheck Protection Program loans. The form is also updated with new forms that are in line with the most recent stimulus legislation.
The COVID-19 relief plan that Congress passed last month revived the PPP with $284 billion of funding for small businesses seeking forgivable loans to help them 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 after the legislation was adopted to make the process of applying for forgiveness, along with conditions that aim to increase the number of bank loans by community banks, particularly for minority-owned businesses that were unable to obtain loans last year.
“The Small Business Administration met the requirement of releasing the one-page form for loan forgiveness under the PPP within 24 days of 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.”
Forgiveness terms for the first draw of PPP loans
Details Of Student Loan Forgiveness Act – First Draw PPP loans made to borrowers who meet the criteria are eligible for total loan forgiveness during the 8- to 24 week period that follows the loan’s disbursement
- The levels of compensation and employee pay are kept at a constant level.
- The loan funds are used on payroll expenses and other eligible expenses; and
- At least 60% of proceeds go to the cost of payroll
Second Draw PPP Loan Forgiveness Conditions
Second Draw PPP loans made to borrowers who meet the criteria are eligible for total loan forgiveness if they do so during the 8– to 24-week duration following loan disbursement:
- The First Draw PPP loan requires that the employee and compensation levels be maintained in an identical manner.
- The loan funds are used on payroll and other expenses that are eligible and
- A minimum of 60% of proceeds are spent on payroll costs
- How do I apply for loan forgiveness , and the time to apply
After all loan’s proceeds have been used The borrower may apply for forgiveness. Borrowers can apply for forgiveness at any time prior until the date of maturity of the loan. If they do not file for forgiveness within 10 months of the date of expiration of the period covered and the loan is not renewed, PPP loan payments can no longer deferred and borrowers must make loan payments to their PPP lender.
Download Details Of Student Loan Forgiveness Act
Gallery of Details Of Student Loan Forgiveness Act
