Risla Loan Forgiveness

Risla Loan Forgiveness

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, as well as newly revised and updated forms to comply with the latest stimulus legislation. 

The COVID-19 relief package that Congress adopted last month revived the PPP with $284 billion in financing for small-scale businesses looking for forgiven loans to help to deal with the effects of economic collapse of the coronavirus epidemic. The law requires that the SBA release simplified forms within 24 hours of the legislation’s signing into law. This is to simplify the process of applying for forgiveness. The legislation also contained conditions that would encourage community banks to lend more, especially to minority-owned businesses that had difficulty getting loans last year.

Risla Loan Forgiveness

“The Small Business Administration met the requirement of releasing the one-page form for loan forgiveness under the PPP by 24 days after 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 published new forms.”

First Draw PPP Loan forgiveness terms

Risla Loan Forgiveness – First Draw PPP loans granted to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8- to 24-week period after the disbursement of loan:

  • This is also true for compensation and employees.
  • The loan proceeds are used on payroll and other eligible expenses; and
  • A minimum of 60% of the proceeds are spent on payroll costs

Second Draw PPP Loan forgiveness terms

Second Draw PPP loans given to borrowers who meet the criteria are eligible for full loan forgiveness if during the 8to 24 week covered period following loan payment:

  • The First Draw PPP loan requires that the compensation and employee levels be maintained in the identical manner.
  • The loan proceeds could be used to pay payroll costs or other expenses that are eligible.
  • At least 60% of funds go to expenses for payroll
  • When and how do I apply for loan forgiveness?

A borrower can apply for forgiveness once all loan 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. Borrowers who don’t request forgiveness within 10 months of the expiration date of the loan are able to receive loan payments from their PPP lender.

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