The U.S. Small Business Administration released a one-page form that aims to simplify the application process for forgiveness of Paycheck Protection Program loans, as well as newly updated and revised forms to comply with the latest stimulus legislation.
The COVID-19 relief package that Congress adopted last month revived the PPP with $284 billion of funds for small businesses that want forgiven loans to help to deal with the effects of economic collapse from the coronavirus pandemic. The law required that the SBA provide simplified forms within 24 hours after the bill’s passage into law. This is to simplify the process of applying for forgiveness. It also included conditions that would encourage community banks to lend more particularly to minority-owned businesses that had difficulty getting loans last year.
“The Small Business Administration met the requirement of releasing the one-page form for PPP loan forgiveness by 24 days after the date of the 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 issued updated forms.”
Terms for forgiveness for the first draw of PPP loans
Federal Loan Forgiveness For Doctors – For those who qualify, First Draw PPP loans are suitable for loan forgiveness. This applies when the loan payment is made within an 8 to 24 week period.
- It’s the same for employee compensation and the.
- The loan proceeds can be used to cover the cost of payroll as well as other expenses that are eligible.
- A minimum of 60% of the profits are used to pay for payroll expenses
Second Draw PPP Loan Forgiveness Conditions
Second Draw PPP loans for eligible borrowers can be eligible for loan forgiveness when the loan is repaid within an 8to 24-week time frame.
- The First Draw PPP loan requires that the compensation and employee levels be maintained in an exact same way.
- The loan funds are used on payroll costs and other expenses that are eligible and
- At least 60% of profits go towards the cost of payroll
- When and how do I apply for loan forgiveness
When all of the loan proceeds have been used the borrower is eligible for forgiveness. The borrower can apply for forgiveness at any time up to the loan’s maturity date. Borrowers who don’t request forgiveness within 10 month of the end date of the loan are eligible to receive payment from their PPP lender.
Download Federal Loan Forgiveness For Doctors
Gallery of Federal Loan Forgiveness For Doctors
