How To Submit Public Service Loan Forgiveness Certification Form

How To Submit Public Service Loan Forgiveness Certification Form

The U.S. Small Business Administration has released a form of one page that makes it easier to apply for forgiveness of Paycheck Protection Program loans. It also includes newly revised forms to comply with the latest stimulus law. 

Congress approved the COVID-19 relief package last month, which provided $284 billion of funding for small-scale businesses who needed loans. The funds were used to mitigate the economic effects of the coronavirus epidemic. It also included a requirement that the SBA to issue simplified forms within 24 hours of the bill being adopted to make the application process for forgiveness. The legislation also contained conditions that aim to increase the number of loans from community banks, specifically for minority-owned companies that were unable to obtain loans last year.

How To Submit Public Service Loan Forgiveness Certification Form

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs stated that the Small Business Administration fulfilled the requirement to issue the one-page form for PPP loan forgiveness within 24 days from the date of enactment in the Consolidated Appropriations Act, 20,21. This was published on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also published updated forms.”

Forgiveness terms in the first draw of PPP loans

How To Submit Public Service Loan Forgiveness Certification Form – First Draw PPP loans granted to eligible borrowers qualify for complete loan forgiveness if they do so within the 8-to 24 week period that follows the disbursement of loan:

  • Employee and compensation levels are ensured
  • The proceeds of the loan can be used to pay the cost of payroll as well as other eligible expenses.
  • At least 60% of the profits are used for the cost of payroll

Second Draw PPP Terms of Loan Forgiveness

Second Draw PPP loans given to borrowers who meet the criteria are eligible for complete loan forgiveness, if within the 8to 24-week time period after the loan’s disbursement

  • The First Draw PPP loan requires that the employee and the compensation levels be maintained in the identical manner.
  • The loan funds can be used to cover the cost of payroll as well as other eligible expenses.
  • At least 60% of profits are spent on payroll costs
  • How do I apply for loan forgiveness , and the time to apply

A borrower can apply for forgiveness once all loan proceeds to which the borrower wants forgiveness have been used. Borrowers can request forgiveness at any time until the date of maturity. 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.

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