Wells Fargo Loan Forgiveness Program

Wells Fargo Loan Forgiveness Program

The U.S. Small Business Administration has issued a one-page form that simplifies the application for forgiveness of Paycheck Protection Program loans. The form also contains newly updated forms that are in line with the latest stimulus law. 

The COVID-19 relief plan that Congress approved last month renewed the PPP with $284 billion of funds for small businesses that want forgiveness loans to help them to deal with the effects of economic collapse of the coronavirus epidemic. The package also mandated the SBA to issue streamlined forms within 24 days after the legislation was approved by the lawmaker to streamline the procedure of applying for forgiveness. It also included conditions meant to encourage more loans from community banks, particularly for minority-owned businesses who struggled to get loans in the past.

Wells Fargo Loan Forgiveness Program

“The Small Business Administration met the requirement to issue the one-page form for loan forgiveness under the PPP 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 published the updated forms.”

First Draw PPP Terms of loan forgiveness

Wells Fargo Loan Forgiveness Program – First Draw PPP loans made to borrowers who are eligible can be granted full loan forgiveness if during the 8- to 24-week period after the disbursement of loan:

  • The levels of compensation and employee pay are maintained
  • The loan proceeds are spent on payroll expenses and other eligible expenses; and
  • Minimum 60% of proceeds go to the cost of payroll

Second Draw PPP Conditions for loan forgiveness

Second Draw PPP loans to qualified customers are eligible for loan repayment when the loan is repaid within an 8 24 week period.

  • The First Draw PPP loan requires that the employee and compensation levels be maintained in an exactly the same manner.
  • The proceeds of the loan could be used to pay for payroll costs or other eligible expenses.
  • At least 60% of funds go to the cost of payroll
  • How do I apply for loan forgiveness and the time to apply

A borrower can apply for forgiveness only after all loan proceeds for which the borrower has applied for forgiveness have been used. Borrowers can request forgiveness at any time up to the date of maturity. If the borrower does not apply for forgiveness within 10 months of the last day of the time period that was covered the PPP loans are no longer deferred and borrowers must make loan payments to their PPP lender.

Download Wells Fargo Loan Forgiveness Program

Gallery of Wells Fargo Loan Forgiveness Program


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