Student Loan Forgiveness Stimulus Check

The U.S. Small Business Administration has released a 1-page form that makes it easier to apply for the cancellation of Paycheck Protection Program loans. The form also contains newly updated forms that comply with the most recent stimulus legislation. 

The COVID-19 aid package Congress approved last month renewed 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. It included a requirement for the SBA to issue streamlined forms within 24 hours of the legislation being approved by the lawmaker to streamline the process of applying for forgiveness. It also included conditions designed to facilitate more loans from community banks, particularly for minority-owned businesses who were unable to obtain loans in the past.

Student Loan Forgiveness Stimulus Check

“The Small Business Administration met the requirement to issue the one-page form for PPP loan forgiveness within 24 days of 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 released the updated forms.”

First Draw PPP Conditions for loan forgiveness

Student Loan Forgiveness Stimulus Check – First Draw PPP loans given to borrowers who meet the criteria are eligible for total loan forgiveness within the 8 to 24-week period after the loan’s disbursement

  • The same goes for the employee compensation and the.
  • The proceeds of the loan can be used to cover payroll costs or other expenses that are eligible.
  • At least 60% of proceeds go to payroll costs

Second Draw PPP Loan forgiveness terms

Second Draw PPP loans granted to borrowers who are eligible can be granted full loan forgiveness if during the 8to 24-week duration following loan payment:

  • Pay and worker levels are maintained in the same way as required for the First Draw PPP loan
  • The loan funds can be used to cover the cost of payroll as well as other eligible expenses.
  • Minimum 60% of profits go towards payroll costs
  • How to request loan forgiveness and when to apply

The borrower is eligible for forgiveness only after all loan proceeds for which the borrower has applied for forgiveness have been utilized. The borrower can apply for forgiveness at any time up to the loan’s maturity date. Borrowers who don’t request 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.

Download Student Loan Forgiveness Stimulus Check

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