What Is The Deadline For Ppp Loan Forgiveness 2022

What Is The Deadline For Ppp Loan Forgiveness 2022

The U.S. Small Business Administration has released a single-page form aimed at simplifying the process of applying to forgive Paycheck Protection Program loans, along with newly revised and updated forms to conform to the requirements of the most recent stimulus legislation. 

Congress approved the COVID-19 relief package in the month of March, which offered $284 billion in funding for small-scale businesses who needed loans. The funds were used to reduce the economic burden of the coronavirus pandemic. The law requires that the SBA release simplified forms within the first 24 hours of the legislation’s signing into law. This was done to make it easier to apply for forgiveness. Additionally, it included conditions to encourage community banks to make more loans, especially to minority-owned businesses that had difficulty getting loans last year.

What Is The Deadline For Ppp Loan Forgiveness 2022

Ed Zollars, a partner with Thomas, Zollars & Lynch CPAs wrote that the Small Business Administration fulfilled the requirement to publish the one-page PPP form loan forgiveness within 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 additional updated forms.”

First Draw PPP Loan forgiveness terms

What Is The Deadline For Ppp Loan Forgiveness 2022 – First Draw PPP loans made to eligible borrowers qualify for complete loan forgiveness if they do so within the 8-to 24-week period after loan disbursement:

  • Pay and worker levels are ensured
  • The loan funds are used on payroll expenses and other expenses that are eligible and
  • Minimum 60% of profits go towards expenses for payroll

Second Draw PPP Conditions for loan forgiveness

Second Draw PPP loans given to borrowers who are eligible can be granted total loan forgiveness if they do so during the 8to 24-week time period after loan disbursement:

  • The First Draw PPP loan requires that the compensation and employee levels are maintained in the exact same way.
  • The loan proceeds are spent on payroll expenses and other eligible expenses; and
  • At least 60% of profits are spent on payroll costs
  • How to request loan forgiveness and the time to apply

After all loan proceeds have been used, a borrower can apply to be forgiven. Borrowers can request forgiveness at any time until the loan’s maturity date. If the borrower does not apply for forgiveness within 10 years of the date of expiration of the covered period and the loan is not renewed, PPP loan payments are not deferred any longer, and borrowers will begin making payment to their PPP lender.

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