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 that comply with the most recent stimulus legislation.
The COVID-19 relief plan that Congress passed last month revived the PPP with $284 billion of financing for small-scale businesses looking for forgiven loans to help deal with the financial fallout of the coronavirus epidemic. It included a requirement for the SBA to issue simplified forms within 24 days of the bill being approved by the lawmaker to streamline the process of applying for forgiveness. It also included conditions meant to encourage more loans from community banks, specifically for minority-owned businesses who were unable to obtain 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 form for PPP loan forgiveness within the first 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 published the updated forms.”
Terms for forgiveness for the first draw of PPP loans
Ppp Loan Forgiveness Sole Proprietor – For eligible borrowers, First Draw PPP loans are suitable for loan forgiveness. This applies when the loan is disbursed within an 8– to 24-week timeframe.
- It’s the same for employee compensation and the.
- The proceeds of the loan can be used to pay for payroll costs or other eligible expenses.
- Minimum 60% of funds go to payroll costs
Second Draw PPP Loan Forgiveness The terms
Second Draw PPP loans granted to eligible borrowers qualify for full loan forgiveness if during the 8to 24 week duration following the loan’s disbursement
- Employee and compensation levels are kept in the same way as required for the First Draw PPP loan
- The loan proceeds are spent on payroll costs and other eligible expenses; and
- At least 60% of profits are used for the cost of payroll
- When and how do I apply for loan forgiveness?
The borrower is eligible for forgiveness after the loan’s proceeds for which the borrower wants forgiveness have been used. Borrowers can request forgiveness at any time up to the date of maturity. If they do not file for forgiveness within 10 months after the last day of the period covered the PPP loans are not deferred any longer, and the borrower will be required to make payment to their PPP lender.
Download Ppp Loan Forgiveness Sole Proprietor
Gallery of Ppp Loan Forgiveness Sole Proprietor
