The U.S. Small Business Administration released a one-page form that aims to simplify the process of applying for forgiveness of Paycheck Protection Program loans, together with revised and updated forms to comply with 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 forgiveness loans to help them deal with the financial fallout from the coronavirus outbreak. The legislation required that the SBA release simplified forms within 24 hours of the signing into law. This is to make it easier to apply for forgiveness. Additionally, it included conditions that would encourage banks in the community to lend more specifically to minority-owned companies that had difficulty getting loans last year.
Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, wrote that the Small Business Administration fulfilled the obligation to issue the one-page PPP form loan forgiveness within 24 hours from the date of the enactment of the Consolidated Appropriations Act, 20,21. The article was posted on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also released new forms.”
First Draw PPP Loan forgiveness terms
Obama Student Loan Forgiveness – First Draw PPP loans made to eligible borrowers qualify for complete loan forgiveness if they do so within the 8 to 24 week period that follows the loan’s disbursement
- It’s the same for pay and benefits for employees.
- The loan funds are used on payroll and other eligible expenses; and
- At least 60% of profits are used for the cost of payroll
Second Draw PPP Loan Forgiveness Terms
Second Draw PPP loans to eligible borrowers can be qualified for loan forgiveness when the loan is repaid within an 8to 24-week time frame.
- The levels of compensation and employee pay are maintained in the same manner as is required for the First Draw PPP loan
- The loan proceeds are spent on payroll costs as well as other eligible expenses and
- A minimum of 60% of the proceeds are spent on payroll costs
- How do I apply for loan forgiveness and when
A borrower may apply for forgiveness once the loan’s proceeds for which the borrower wants forgiveness have been used. Borrowers are able to apply for forgiveness anytime up to the maturity date of the loan. If borrowers do not apply for forgiveness within 10 month of the expiration date of the loan will be able to receive the loan payment from their PPP lender.
Download Obama Student Loan Forgiveness
Gallery of Obama Student Loan Forgiveness
