Public Service Loan Forgiveness Application Form

Public Service Loan Forgiveness Application Form

The U.S. Small Business Administration issued a one-page application form that aims to simplify the process of applying for the forgiveness of Paycheck Protection Program loans, together with revised and updated forms to meet the requirements of the most recent stimulus legislation. 

The COVID-19 relief package that Congress approved last month renewed the PPP with $284 billion in funds for small businesses that want forgiven loans to help deal with the financial fallout of the coronavirus epidemic. The law requires that the SBA provide simplified forms within 24 hours of the signing into law. This was to make it easier to apply for forgiveness. The legislation also contained conditions that encourage community banks to make more loans particularly to minority-owned businesses who had a difficult time getting loans in the past.

Public Service Loan Forgiveness Application Form

“The Small Business Administration met the requirements to release the single-page form for loan forgiveness under the PPP within 24 days of the date of the 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 additional updated forms.”

Terms for forgiveness for the initial draw of PPP loans

Public Service Loan Forgiveness Application Form – For eligible borrowers First Draw PPP loans are suitable for loan forgiveness. This happens when the loan payment is made within an 8 to 24-week period.

  • Employee and compensation levels are maintained
  • The loan funds are used on payroll and other eligible expenses; and
  • A minimum of 60% of the profits go towards expenses for payroll

Second Draw PPP Conditions for loan forgiveness

Second Draw PPP loans made to eligible borrowers qualify for total loan forgiveness if they do so during the 8to 24 week covered period following loan payment:

  • Pay and worker levels are maintained in the same manner as is required for the First Draw PPP loan
  • The loan funds could be used to cover the cost of payroll as well as other eligible expenses.
  • At least 60% of funds go to expenses for payroll
  • How do I apply for loan forgiveness , and when

A borrower can apply for forgiveness once the loan’s proceeds for which the borrower has applied for 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 last day of the time period that was covered the PPP loan payments are not deferred any longer, and the borrower will be required to make monthly payments to their PPP lender.

Download Public Service Loan Forgiveness Application Form

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