The U.S. Small Business Administration has issued a one-page form that makes it easier to apply for the cancellation of Paycheck Protection Program loans. The form also contains newly updated forms that are in line with the latest stimulus law.
Congress approved the COVID-19 relief plan last month, which included $284 billion of financing to small businesses in need of loans. The money was intended to reduce the economic burden of the coronavirus epidemic. It included a requirement for the SBA to issue streamlined forms within 24 hours of the bill being adopted to make the application process for forgiveness. The legislation also contained conditions meant to encourage more loans from community banks, especially for minority-owned businesses that had trouble getting loans in the past.
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 24 days of the date of the enactment of the Consolidated Appropriations Act, 20,21. This was published on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also released additional updated forms.”
First Draw PPP Terms of loan forgiveness
Reputable Student Loan Forgiveness Programs – For those who qualify, First Draw PPP loans can be suitable to be forgiven. This applies when the loan is disbursed within an 8– to 24-week period.
- Pay and worker levels are maintained
- The loan funds are used on payroll as well as other expenses eligible for reimbursement; and
- Minimum 60% of profits go towards payroll costs
Second Draw PPP Loan Forgiveness The terms
Second Draw PPP loans to eligible borrowers can be qualified for loan forgiveness when the loan is paid within an 8– to 24 week period.
- The First Draw PPP loan requires that the employee and compensation levels be maintained in an exact same way.
- The loan funds are used on payroll expenses and other expenses that are eligible and
- Minimum 60% of proceeds go to expenses for payroll
- How do I apply for loan forgiveness , and when to apply
A borrower can apply for forgiveness after all loan proceeds to which the borrower has applied for forgiveness have been used. Borrowers may apply for forgiveness at any point up to the date at which the loan matures. If borrowers do not apply for forgiveness within 10 month after the date they will be able to repay the loan will be able to receive payment from their PPP lender.
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