The U.S. Small Business Administration has released a 1-page form which makes it simpler to request the cancellation of Paycheck Protection Program loans. It also includes newly revised forms that are in line with the current stimulus law.
Congress approved the COVID-19 relief package in the month of March that included $284 billion of financing to small businesses that needed loans. The money was intended to mitigate the economic effects of the coronavirus outbreak. The law required that the SBA provide simplified forms within 24 hours of the legislation’s signing into law. This was done to facilitate the application for forgiveness. Additionally, it included conditions that encourage community banks to lend more specifically to minority-owned companies who had a difficult time getting loans last year.
Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs, stated that the Small Business Administration fulfilled the requirement to issue the PPP form, which is one page long, for loan forgiveness within the first 24 hours from the date of enactment under the Consolidated Appropriations Act, 20,21. This was on the Current Federal Tax Developments blog of Kaplan Financial Education. “The agency also published additional updated forms.”
First Draw PPP Conditions for loan forgiveness
Student Loan Debt Forgiveness Calls – First Draw PPP loans given to eligible borrowers qualify for complete loan forgiveness if they do so within the 8-to 24-week covered period following the disbursement of loan:
- This is also true for employee compensation and the.
- The loan proceeds can be used to pay expenses for payroll or other eligible expenses.
- Minimum 60% of profits go towards expenses for payroll
Second Draw PPP Loan Forgiveness Conditions
Second Draw PPP loans to qualified customers are qualified for loan forgiveness when the loan is repaid within an 8– to 24-week time frame.
- The levels of compensation and employee pay are kept in the same way as required for the First Draw PPP loan
- The loan proceeds are spent on payroll expenses and other eligible expenses; and
- At least 60% of funds go to expenses for payroll
- How to request loan forgiveness and when
A borrower can apply for forgiveness only 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 of maturity. If the borrower does not apply for forgiveness within 10 months after the end of the period covered and the loan is not renewed, PPP loans are no longer deferred, and borrowers will begin making loan payments to their PPP lender.
Download Student Loan Debt Forgiveness Calls
Gallery of Student Loan Debt Forgiveness Calls
