Fedloan Public Service Loan Forgiveness Form

The U.S. Small Business Administration has released a 1-page form that makes it easier to apply for the cancellation of Paycheck Protection Program loans. It also includes newly revised forms that are in line with the current stimulus law. 

The COVID-19 aid package Congress approved last month renewed the PPP with $284 billion of funds for small businesses that want forgiven loans to help cope with the economic fallout of the coronavirus epidemic. The law requires that the SBA release simplified forms within the first 24 hours after the bill’s passage into law. This is to facilitate the application for forgiveness. Additionally, it included conditions that encourage community banks to lend more specifically to minority-owned companies who had a difficult time getting loans last year.

Fedloan Public Service Loan Forgiveness Form

“The Small Business Administration met the requirement to issue the one page form for PPP loan forgiveness within 24 hours of the date of enactment the Consolidated Appropriations Act, 2021,” wrote Ed Zollars, a partner at Thomas, Zollars & Lynch CPAs on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also released additional updated forms.”

Forgiveness terms for the first draw of PPP loans

Fedloan Public Service Loan Forgiveness Form – For eligible borrowers First Draw PPP loans can be eligible for loan forgiveness. This applies when the loan payment is made within an 8 to 24-week timeframe.

  • The same goes for the pay and benefits for employees.
  • The loan proceeds are spent on payroll as well as other expenses eligible for reimbursement; and
  • At least 60% of the profits are used to pay for payroll expenses

Second Draw PPP Conditions for loan forgiveness

Second Draw PPP loans given to eligible borrowers qualify for full loan forgiveness if during the 8to 24-week time period after the loan’s disbursement

  • The First Draw PPP loan requires that the compensation and employee levels be maintained in an identical manner.
  • The loan funds are used on payroll costs and other expenses that are eligible and
  • A minimum of 60% of the proceeds go to expenses for payroll
  • How do I apply for loan forgiveness , and the time to apply

Once all of the loan proceeds have been used The borrower may apply to be granted forgiveness. The borrower can apply for forgiveness at any time up to the date at which the loan matures. If they do not file for forgiveness within 10 months after the end of the covered period and the loan is not renewed, PPP loan payments can no longer deferred, and the borrower will be required to make payment to their PPP lender.

Download Fedloan Public Service Loan Forgiveness Form

Gallery of Fedloan Public Service Loan Forgiveness Form

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