Loan Forgiveness Form 2022

The U.S. Small Business Administration issued a one-page application form designed to make it easier for applicants to complete the process of applying to forgive Paycheck Protection Program loans, along with newly updated and revised forms to conform to the requirements of the latest stimulus legislation. 

The COVID-19 relief plan that Congress approved last month renewed the PPP with $284 billion in funds for small businesses that want forgivable loans to help them cope with the economic fallout of the coronavirus epidemic. It also included a requirement that the SBA to issue simplified forms within 24 hours after the legislation was approved by the lawmaker to streamline the process of applying for forgiveness. The legislation also contained conditions meant to encourage more bank loans by community banks, specifically for minority-owned businesses who were unable to obtain loans last year.

Loan Forgiveness Form 2022

“The Small Business Administration met the requirement to issue the one page form for loan forgiveness under the PPP 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 published additional updated forms.”

Forgiveness terms for the first draw of PPP loans

Loan Forgiveness Form 2022 – For those who qualify First Draw PPP loans are qualified to forgive loans. This applies when the loan is disbursed within an 8 to 24-week period.

  • The levels of compensation and employee pay are kept at a constant level.
  • The proceeds from the loan may be used to cover the cost of payroll as well as other expenses that are eligible.
  • A minimum of 60% of the profits are spent on payroll costs

Second Draw PPP Loan Forgiveness Terms

Second Draw PPP loans to qualified borrowers can be eligible for loan repayment if the loan is paid within an 8to 24-week time frame.

  • The First Draw PPP loan requires that the employee and compensation levels be maintained in the exact same way.
  • The proceeds of the loan can be used to pay the cost of payroll as well as other expenses that are eligible.
  • A minimum of 60% of profits are used for the cost of payroll
  • How to request loan forgiveness and the time to apply

The borrower is eligible for forgiveness after the loan’s proceeds for which the borrower is requesting forgiveness have been utilized. The borrower can request forgiveness at any time prior until the date of maturity of the loan. 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 Loan Forgiveness Form 2022

Gallery of Loan Forgiveness Form 2022

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