The U.S. Small Business Administration released a one-page form designed to make it easier for applicants to complete the process of applying for the forgiveness of Paycheck Protection Program loans, together with updated and revised forms to conform to the requirements of the most recent stimulus legislation.
The COVID-19 relief plan that Congress adopted last month revived the PPP with $284 billion in funding for small businesses seeking forgivable loans to help them to deal with the effects of economic collapse from the coronavirus outbreak. It also included a requirement that the SBA to issue streamlined forms within 24 hours after the legislation was adopted to make the application process for forgiveness, along with conditions that aim to increase the number of bank loans by community banks, particularly for minority-owned businesses who struggled to get loans in the past.
Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, stated that the Small Business Administration fulfilled the obligation to issue the PPP form, which is one page long, for loan forgiveness within the first 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 released the updated forms.”
First Draw PPP Loan forgiveness terms
Public Student Loan Forgiveness Pslf Employment Certification Form – For borrowers who are eligible, First Draw PPP loans can be qualified for loan forgiveness. This applies if the loan disbursement occurs within an 8 to 24-week period.
- This is also true for compensation and employees.
- The loan proceeds can be used to pay for the cost of payroll as well as other eligible expenses.
- A minimum of 60% of the profits go towards expenses for payroll
Second Draw PPP Loan Forgiveness Terms
Second Draw PPP loans to qualified customers are qualified for loan forgiveness when the loan is repaid within an 8– 24-week period.
- The First Draw PPP loan requires that the compensation and employee levels are maintained in the exact same way.
- The proceeds of the loan can be used to cover expenses for payroll or other eligible expenses.
- At least 60% of the profits are used to pay for payroll expenses
- When and how do I apply for loan forgiveness?
Once all of the loan’s proceeds have been used The borrower may apply to be forgiven. The borrower can apply for forgiveness at any time up to the loan’s maturity date. If they do not file for forgiveness within 10 years of the last day of the time period that was covered and the loan is not renewed, PPP loan payments can no longer deferred and borrowers must make loan payments to their PPP lender.