Parent Plus Loan Forgiveness For Teachers

The U.S. Small Business Administration has released a 1-page form that makes it easier to apply for forgiveness of Paycheck Protection Program loans. The form is also updated with new forms to comply with the current stimulus law. 

Congress approved the COVID-19 relief package in the month of March, which offered $284 billion in funding to small businesses that needed loans. The funds were used to mitigate the economic effects of the coronavirus epidemic. It included a requirement for the SBA to issue simplified forms within 24 days after the legislation was adopted to make the application process for forgiveness. The legislation also contained conditions that aim to increase the number of bank loans by community banks, especially for minority-owned companies that were unable to obtain loans last year.

Parent Plus Loan Forgiveness For Teachers

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

First Draw PPP Terms of loan forgiveness

Parent Plus Loan Forgiveness For Teachers – First Draw PPP loans given to borrowers who are eligible can be granted total loan forgiveness within the 8 to 24-week period after the loan’s disbursement

  • Employee and compensation levels are maintained
  • The loan proceeds are used on payroll as well as other expenses eligible for reimbursement; and
  • At least 60% of profits go towards the cost of payroll

Second Draw PPP Terms of Loan Forgiveness

Second Draw PPP loans to qualified borrowers 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 be maintained in the exactly the same manner.
  • The loan funds can be used to pay the cost of payroll as well as other eligible expenses.
  • Minimum 60% of profits go towards expenses for payroll
  • How do I apply for loan forgiveness , and the time to apply

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 at any time prior to the maturity date of the loan. If they do not file for forgiveness within 10 months of the date of expiration of the period covered, then PPP loan payments can no longer deferred, and the borrower will be required to make payment to their PPP lender.

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