Money Mentor Student Loan Forgiveness

The U.S. Small Business Administration has released a single-page form that aims to simplify the process of applying for forgiveness of Paycheck Protection Program loans, along with newly updated and revised forms to comply with the latest stimulus legislation. 

Congress approved the COVID-19 relief package last month that included $284 billion of financing to small businesses in need of loans. The money was intended to reduce the economic burden of the coronavirus outbreak. The law required that the SBA issue simplified forms within 24 hours of the signing into law. This is to make it easier to apply for forgiveness. It also included conditions to encourage community banks to make more loans particularly to minority-owned businesses that had difficulty getting loans last year.

Money Mentor Student Loan Forgiveness

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

First Draw PPP Loan forgiveness terms

Money Mentor Student Loan Forgiveness – 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.

  • This is also true for employee compensation and the.
  • The loan proceeds can be used to pay expenses for payroll or other expenses that are eligible.
  • A minimum of 60% of the profits are used for the cost of payroll

Second Draw PPP Loan Forgiveness Terms

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

  • The First Draw PPP loan requires that the employee and compensation levels be maintained in the identical manner.
  • The loan proceeds could be used to pay for the cost of payroll as well as other eligible expenses.
  • At least 60% of profits go towards payroll costs
  • How and when to apply for loan forgiveness?

A borrower can apply for forgiveness once all loan proceeds to which the borrower has applied for forgiveness have been utilized. Borrowers are able to apply for forgiveness any time up to the maturity date of the loan. If they do not file for forgiveness within 10 months of the last day of the period covered and the loan is not renewed, PPP loans are no longer deferred and the borrower will be required to make monthly payments to their PPP lender.

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