The U.S. Small Business Administration released a one-page form aimed at simplifying the application process for the forgiveness of Paycheck Protection Program loans, along with newly revised and updated forms to meet the requirements of the most recent stimulus legislation.
The COVID-19 relief plan that Congress adopted last month revived the PPP with $284 billion of financing for small-scale businesses looking for forgiven loans to help cope with the economic fallout from the coronavirus outbreak. The legislation required that the SBA issue simplified forms within 24 hours after the bill’s passage into law. This was to make it easier to apply for forgiveness. The legislation also contained conditions that would encourage community banks to make more loans particularly to minority-owned businesses who had a difficult time getting loans last year.
Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, stated that the Small Business Administration fulfilled the requirement to issue the one-page form for PPP 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 more updated forms.”
First Draw PPP Terms of loan forgiveness
Nurse Loan Forgiveness Illinois – First Draw PPP loans granted to borrowers who meet the criteria are eligible for full loan forgiveness if within the 8-to 24-week covered period following the loan’s disbursement
- It’s the same for pay and benefits for employees.
- The loan proceeds can be used to cover the cost of payroll as well as other expenses that are eligible.
- At least 60% of the proceeds are spent on payroll costs
Second Draw PPP Loan Forgiveness The terms
Second Draw PPP loans to eligible customers are eligible for loan forgiveness if the loan is paid within an 8– to 24-week period.
- The First Draw PPP loan requires that the employee and the compensation levels are maintained in the exactly the same manner.
- The loan funds could be used to cover payroll costs or other eligible expenses.
- A minimum of 60% of the profits go towards payroll costs
- What is the best time to apply for loan forgiveness?
A borrower may apply for forgiveness only after the loan’s proceeds for which the borrower has applied for forgiveness have been utilized. Borrowers are able to apply for forgiveness any time up until the date of maturity of the loan. If borrowers do not apply for forgiveness within 10 month after the date they will be able to repay the loan are able to receive payment from their PPP lender.