The U.S. Small Business Administration has released a 1-page form that simplifies the application for forgiveness of Paycheck Protection Program loans. The form is also updated with new 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 in funds for small businesses that want forgiven loans to help deal with the financial fallout from the coronavirus pandemic. It also included a requirement that the SBA to issue streamlined forms within the first 24 hours of the legislation being signed into law to simplify the application process for forgiveness. The legislation also contained conditions designed to facilitate more loans from community banks, especially for minority-owned businesses who had trouble getting loans in the past.
Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, stated that the Small Business Administration fulfilled the requirement to issue the one-page PPP form loan forgiveness within the first 24 hours of 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.”
First Draw PPP Conditions for loan forgiveness
Itt Tech Loan Forgiveness 2022 Application – For borrowers who are eligible First Draw PPP loans can be qualified to forgive loans. This applies when the loan payment is made within an 8– to 24 week period.
- The same goes for the pay and benefits for employees.
- The proceeds of the loan can be used to pay the cost of payroll as well as other expenses that are eligible.
- At least 60% of proceeds go to the cost of payroll
Second Draw PPP Loan Forgiveness Terms
Second Draw PPP loans granted to borrowers who are eligible can be granted complete loan forgiveness, if within the 8to 24 week covered period following the loan’s disbursement
- The First Draw PPP loan requires that the compensation and employee levels are maintained in the exact same way.
- The loan funds could be used to pay for payroll costs or other expenses that are eligible.
- At least 60% of proceeds are used for the cost of payroll
- How do I apply for loan forgiveness , and the time to apply
A borrower may apply for forgiveness only after the loan’s proceeds for which the borrower is requesting forgiveness have been utilized. Borrowers are able to apply for forgiveness anytime up to the maturity date of the loan. If borrowers do not apply for forgiveness within 10 months of the end of the time period that was covered the PPP loans are no longer deferred, and the borrower will be required to make loan payments to their PPP lender.