The U.S. Small Business Administration has issued a one-page form that makes it easier to apply for forgiveness of Paycheck Protection Program loans. The form is also updated with new forms that are in line with the latest stimulus legislation.
Congress approved the COVID-19 relief plan last month and provided $284 billion of funding to small businesses in need of loans. This money was used to reduce the economic burden of the coronavirus epidemic. 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 process of applying for forgiveness. The legislation also contained conditions that aim to increase the number of bank loans by community banks, specifically for minority-owned businesses that had trouble getting loans last year.
“The Small Business Administration met the requirement of releasing the single-page form for the forgiveness of PPP loans within 24 hours of the date of the enactment of the Consolidated Appropriations Act, 2021,” wrote Ed Zollars who is a partner of Thomas, Zollars & Lynch CPAs, on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also issued more updated forms.”
First Draw PPP Conditions for loan forgiveness
Native American Student Loan Forgiveness – First Draw PPP loans made to borrowers who are eligible can be granted full loan forgiveness if within the 8-to 24-week covered period following loan disbursement:
- The same goes for the pay and benefits for employees.
- The loan funds are used on payroll expenses and other expenses that are eligible and
- At least 60% of proceeds are used for the cost of payroll
Second Draw PPP Loan Forgiveness Conditions
Second Draw PPP loans granted to borrowers who meet the criteria are eligible for total loan forgiveness if they do so during the 8to 24 week duration following loan disbursement:
- The First Draw PPP loan requires that the employee and compensation levels are maintained in the exactly the same manner.
- The loan proceeds are used on payroll expenses and other expenses that are eligible and
- Minimum 60% of funds go to the cost of payroll
- How and when to apply for loan forgiveness
After all loan proceeds have been used The borrower may apply to be forgiven. Borrowers can apply for forgiveness anytime up to the maturity date of the loan. If borrowers do not apply for forgiveness within 10 months of the last day of the time period that was covered the PPP loan payments are not deferred any longer, and borrowers must make monthly payments to their PPP lender.
Download Native American Student Loan Forgiveness
Gallery of Native American Student Loan Forgiveness
