How to Get Your PPP Loan Forgiven (February 2021)
The federal government’s Paycheck Protection Program can be confusing to navigate. We’re here to help.
Were you approved for the first-draw PPP loan and wondering how you can get your loan forgiven? Are you interested in applying for the second-draw PPP loan, but don’t know if you qualify? The Paycheck Protection Program was started to assist many small businesses in during these tough times. But sorting through all of the PPP’s rules and documents can be challenging, especially since these are updated on an almost weekly basis. We’re here to help you figure out what expenses are covered under the second-draw PPP loan, when the deadlines fall, what documents you’ll need to submit along with your PPP loan forgiveness application, and everything else you need to know about how to get your PPP loan forgiven.
Wondering exactly what you need to do to get your PPP loan forgiven? Download our free white paper that explains the ins and outs of the Paycheck Protection Program.
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An Overview of How to Get Your PPP Loan Forgiven
When figuring out how to get your PPP loan forgiven, it can be confusing. We understand what it’s like to have to weed through pages and pages of information, trying to decipher which parts are important and which are just fluff.
Here’s a quick overview to help small businesses get the gist of how to get their PPP loan forgiven:
- All employees must be kept on staff and paid the same wages they were paid prior to the pandemic, working the usual hours for the typical salary.
- The loan is spent on payroll expenses and other eligible costs, with at least 60% spent on payroll costs.
- Application for loan forgiveness must be submitted 8 weeks after first payment of loan received.
- Good Faith Certification, also “Safe Harbor” for the application process
- If requesting less than $2 million, it is believed businesses had less access to adequate sources of funding
- PPP loans will still undergo review and need careful documentation during the PPP forgiveness process
First-Draw PPP Loan vs. Second-Draw PPP Loan
Before undergoing PPP loan forgiveness, you must first decide which PPP loan you should apply for. Basically, if you received a PPP Loan in 2020, you are eligible to apply for the second-draw PPP loan. If you did not receive a PPP loan in 2020, you might still be eligible to apply for a PPP loan under the first-draw requirements. However, there are quite a few differences between each round of the loan. Here is a simple overview of both: