Ppp Loan Forgiveness In New Stimulus Bill

The new stimulus bill now forgives up to eight months of principal and interest payments on section 7 a and 504 microloans from the sba.

Ppp loan forgiveness in new stimulus bill. It simply describes how many employees you were able to retain and how much you spent on payroll costs. Andrew harrer during the summer i wrote about a little known clause in the cares act that turned into a big savings for many small businesses that received loans from the small business administration. Forgiveness is not automatic.

In other words if you got a 10k eidl grant advance in 2020 you had to subtract that amount from your ppp loan forgiveness amount. You still must apply but for loans of 150k or less you can use a one page certification. Importantly at least 60 of the loan must be used for payroll costs note that thisthreshold was.

While the original coronavirus aid relief and economic security act cares act made it clear that the forgiveness of a ppp loan would not be included in income the proposed language for the. Ppp second draw borrowers would be eligible for loan forgiveness equal to the sum of their payroll costs as well as covered mortgage rent and utility payments along with the expanded covered. Ppp2 creates a simplified forgiveness process for loans of up to 150 000.

Ppp loan forgiveness is determined based on how the small business client spent the loan proceeds. The legislation mandates the sba to create a simplified ppp forgiveness application for small businesses whose ppp loans were less than 150 000. To be eligible for full loan forgiveness ppp borrowers will have to spend no less than 60 of the funds on payroll over a covered period of either eight or 24 weeks the same parameters ppp1 had when it stopped accepting applications in august.