Ppp Forgiveness Loan

Ppp Forgiveness Loan

The U.S. Small Business Administration has released a 1-page form that simplifies the application for the cancellation of Paycheck Protection Program loans. The form also contains newly updated forms that comply with the most recent stimulus law. 

Congress approved the COVID-19 relief package last month, which provided $284 billion of funding to small businesses that needed loans. The funds were used to offset the economic impact of the coronavirus outbreak. The law required that the SBA issue simplified forms within the first 24 hours of the signing into law. This is to facilitate the application for forgiveness. The legislation also contained conditions that would encourage community banks to make more loans specifically to minority-owned companies who had a difficult time getting loans in the past.

Ppp Forgiveness Loan

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs said that the Small Business Administration fulfilled the requirement to publish the one-page PPP form loan forgiveness within 24 hours from 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 additional updated forms.”

Forgiveness terms for the first draw of PPP loans

Ppp Forgiveness Loan – For those who qualify First Draw PPP loans can be qualified to be forgiven. This applies when the loan payment is made within an 8 to 24-week timeframe.

  • Employee and compensation levels are kept at a constant level.
  • The loan proceeds can be used to pay for payroll costs or other expenses that are eligible.
  • A minimum of 60% of the proceeds go to the cost of payroll

Second Draw PPP Loan Forgiveness Terms

Second Draw PPP loans granted to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8to 24 week covered period following loan disbursement:

  • The levels of compensation and employee pay are maintained in the same manner as required for the First Draw PPP loan
  • The proceeds of the loan could be used to pay payroll costs or other eligible expenses.
  • At least 60% of funds go to payroll costs
  • When and how do I apply for loan forgiveness?

A borrower can apply for forgiveness after all loan proceeds to which the borrower is requesting forgiveness have been utilized. Borrowers may apply for forgiveness at any time until the date at which the loan matures. If borrowers do not apply for forgiveness within 10 months after the date they will be able to repay the loan are able to receive payment from their PPP lender.

Download Ppp Forgiveness Loan

Gallery of Ppp Forgiveness Loan


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