Student Loan Forgiveness Center Calls

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. The form also contains newly updated forms that are in line with the current stimulus legislation. 

Congress approved the COVID-19 relief package in the month of March and provided $284 billion of funding to small businesses that needed loans. This money was used to offset the economic impact of the coronavirus epidemic. It included a requirement for the SBA to issue streamlined forms within 24 hours of the bill being approved by the lawmaker to streamline the application process for forgiveness. The legislation also contained conditions meant to encourage more loans from community banks, especially for minority-owned companies that were unable to obtain loans last year.

Student Loan Forgiveness Center Calls

“The Small Business Administration met the requirement to issue the one page form for the forgiveness of PPP loans within 24 hours of the date of enactment of the Consolidated Appropriations Act, 2021,” wrote Ed Zollars who is a partner of Thomas, Zollars & Lynch CPAs, on his Current Federal Tax Developments blog for Kaplan Financial Education. “The agency also released new forms.”

Forgiveness terms for the first draw of PPP loans

Student Loan Forgiveness Center Calls – For those who qualify, First Draw PPP loans are qualified to forgive loans. This happens when the loan is disbursed within an 8- to 24 week period.

    • Pay and worker levels are maintained
    • The proceeds from the loan may be used to pay expenses for payroll or other eligible expenses.
    • A minimum of 60% of the proceeds are used to pay for payroll expenses

Second Draw PPP Loan forgiveness terms

Second Draw PPP loans given to borrowers who meet the criteria are eligible for total loan forgiveness if they do so during the 8to 24 week duration following loan disbursement:

    • The First Draw PPP loan requires that the employee and the compensation levels be maintained in the identical manner.
    • The proceeds of the loan could be used to cover expenses for payroll or other eligible expenses.
    • A minimum of 60% of the proceeds are used to pay for payroll expenses
    • How do I apply for loan forgiveness , and when

A borrower can apply for forgiveness only after all loan proceeds for which the borrower has applied for forgiveness have been utilized. Borrowers can request forgiveness at any time until the date at which the loan matures. Borrowers who don’t request forgiveness within 10 month after the date they will be able to repay the loan are able to receive payment from their PPP lender.

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