Loan Forgiveness Form Alaska

The U.S. Small Business Administration released a one-page form aimed at simplifying the application process for forgiveness of Paycheck Protection Program loans, together with updated and revised forms that conform to the requirements of the most recent stimulus legislation. 

Congress approved the COVID-19 relief package in the month of March that provided $284 billion of funding to small businesses that needed loans. The money was intended to reduce the economic burden of the coronavirus pandemic. It included a requirement for the SBA to issue simplified forms within 24 hours of the bill being adopted to make the process of applying for forgiveness. The legislation also contained conditions meant to encourage more bank loans by community banks, particularly for minority-owned businesses that struggled to get loans last year.

Loan Forgiveness Form Alaska

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

Forgiveness terms in the first draw of PPP loans

Loan Forgiveness Form Alaska – First Draw PPP loans made to borrowers who are eligible can be granted full loan forgiveness if within the 8-to 24 week period that follows the loan’s disbursement

  • Employee and compensation levels are ensured
  • The loan funds are used on payroll costs and other expenses that are eligible and
  • At least 60% of the proceeds are used to pay for payroll expenses

Second Draw PPP Terms of Loan Forgiveness

Second Draw PPP loans for eligible customers are qualified for loan forgiveness when the loan is repaid within an 8 24 week period.

  • Pay and worker levels are maintained in the same way in accordance with the First Draw PPP loan
  • The loan proceeds are used on payroll expenses and other expenses that are eligible and
  • A minimum of 60% of profits are used to pay for payroll expenses
  • What is the best time to apply for loan forgiveness?

Once all of the loan proceeds have been used The borrower may apply to be granted forgiveness. The borrower can request forgiveness at any time prior to the maturity date of the loan. If borrowers do not apply for forgiveness within 10 months of the end date of the loan will be able to receive payment from their PPP lender.

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