Sallie Mae Government Loan Forgiveness

Sallie Mae Government Loan Forgiveness

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

The COVID-19 relief plan that Congress passed last month revived the PPP with $284 billion in funding for small businesses seeking forgivable loans to help them cope with the economic fallout from the coronavirus outbreak. The law requires that the SBA provide 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 last year.

Sallie Mae Government Loan Forgiveness

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs and stated that the Small Business Administration fulfilled the obligation to issue the one-page form for PPP loan forgiveness within the first 24 hours of the date of enactment under 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 updated forms.”

Forgiveness terms in the initial draw of PPP loans

Sallie Mae Government Loan Forgiveness – First Draw PPP loans granted to borrowers who are eligible can be granted complete loan forgiveness if they do so within the 8 to 24-week covered period following the disbursement of loan:

  • The levels of compensation and employee pay are maintained
  • The loan proceeds can be used to cover the cost of payroll as well as other expenses that are eligible.
  • At least 60% of profits are spent on payroll costs

Second Draw PPP Loan Forgiveness The terms

Second Draw PPP loans granted to eligible borrowers qualify for complete loan forgiveness, if within the 8to 24 week duration following loan payment:

  • Pay and worker levels are kept in the same way in accordance with the First Draw PPP loan
  • The proceeds of the loan can be used to pay expenses for payroll or other eligible expenses.
  • At least 60% of profits are spent on payroll costs
  • When and how do I apply for loan forgiveness?

A borrower may apply for forgiveness only after all loan proceeds for which the borrower wants forgiveness have been used. Borrowers may apply for forgiveness at any point up to the loan’s maturity date. If the borrower does not apply for forgiveness within 10 months after the date of expiration of the time period that was covered the PPP loans are not deferred any longer, and borrowers will begin making monthly payments to their PPP lender.

Download Sallie Mae Government Loan Forgiveness

Gallery of Sallie Mae Government Loan Forgiveness


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