Pslf Public Service Loan Forgiveness

Pslf Public Service Loan Forgiveness

The U.S. Small Business Administration has released a single-page form designed to make it easier for applicants to complete the application process for the forgiveness of Paycheck Protection Program loans, together with updated and revised forms that comply with the most recent stimulus legislation. 

Congress approved the COVID-19 relief plan last month that provided $284 billion of funding to small businesses in need of loans. The funds were used to reduce the economic burden of the coronavirus pandemic. The legislation required that the SBA release simplified forms within the first 24 hours of the legislation’s signing into law. This is to make it easier to apply for forgiveness. The legislation also contained conditions that encourage community banks to lend more particularly to minority-owned businesses that had difficulty getting loans in the past.

Pslf Public Service Loan Forgiveness

“The Small Business Administration met the requirements to release the one-page form for the forgiveness of PPP loans within 24 hours of the date of the enactment of the Consolidated Appropriations Act, 2021,” wrote Ed Zollars, a partner at Thomas, Zollars & Lynch CPAs on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also released additional updated forms.”

First Draw PPP Conditions for loan forgiveness

Pslf Public Service Loan Forgiveness – First Draw PPP loans given to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8- to 24 week period that follows loan disbursement:

  • This is also true for employee compensation and the.
  • The proceeds from the loan may be used to pay payroll costs or other expenses that are eligible.
  • A minimum of 60% of profits are used for the cost of payroll

Second Draw PPP Loan Forgiveness Conditions

Second Draw PPP loans made to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8to 24-week time period after loan disbursement:

  • 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 can be used to pay for expenses for payroll or other eligible expenses.
  • A minimum of 60% of the proceeds go to payroll costs
  • How do I apply for loan forgiveness , and when to apply

Once all of the loan’s proceeds have been used the borrower is eligible to be forgiven. Borrowers can request forgiveness at any time until the date at which the loan matures. If the borrower does not apply for forgiveness within 10 years of the date of expiration of the time period that was covered the PPP loan payments are no longer deferred and borrowers must make monthly payments to their PPP lender.

Download Pslf Public Service Loan Forgiveness

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