The U.S. Small Business Administration has released a single-page form aimed at simplifying the process of applying for forgiveness of Paycheck Protection Program loans, together with updated and revised forms to meet the requirements of the most recent 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 forgiven loans to help to deal with the effects of economic collapse of the coronavirus epidemic. It also included a requirement that the SBA to issue simplified forms within the first 24 hours of the bill being adopted to make the procedure of applying for forgiveness. It also included conditions designed to facilitate more loans from community banks, specifically for minority-owned businesses who had trouble getting loans last year.
“The Small Business Administration met the requirements to release the one-page form for loan forgiveness under the PPP within 24 days of the date of enactment of the Consolidated Appropriations Act, 2021,” wrote Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also released updated forms.”
First Draw PPP Terms of loan forgiveness
PPP Loan Forgiveness Application New – For borrowers who are eligible First Draw PPP loans are qualified for loan forgiveness. This is when the loan payment is made within an 8– to 24-week timeframe.
- It’s the same for employee compensation and the.
- The loan proceeds are spent on payroll costs as well as other expenses eligible for reimbursement; and
- At least 60% of profits go towards the cost of payroll
Second Draw PPP Loan Forgiveness Conditions
Second Draw PPP loans to eligible borrowers can be eligible for loan forgiveness when the loan is repaid within an 8– to 24 week time frame.
- Employee and compensation levels are maintained in the same manner as is required for the First Draw PPP loan
- The loan funds can be used to pay for expenses for payroll or other eligible expenses.
- A minimum of 60% of the profits are used to pay for payroll expenses
- What is the best time to apply for loan forgiveness?
When all of the loan funds have been utilized The borrower may apply for forgiveness. Borrowers are able to apply for forgiveness anytime up until the date of maturity of the loan. If they do not file for forgiveness within 10 years of the last day of the covered period, then PPP loan payments can not deferred any longer, and borrowers will begin making payment to their PPP lender.
Download PPP Loan Forgiveness Application New
Gallery of PPP Loan Forgiveness Application New
