Should I use 8 weeks or 24 weeks for PPP forgiveness?
You may be able to wrap up the forgiveness process earlier. If you reduce your full-time employee count or employee wages after the 8-week period, that might reduce your eligible forgiveness amounts. However, a longer, 24-week covered period gives you more time to remedy any reductions in employee count or wages.
Should I use 8 weeks or 24 weeks for my PPP loan covered period 2021?
The covered period is the period beginning on the date the lender disburses the PPP loan and ending on the date selected by the borrower that is at least 8 weeks following the date of loan disbursement and not more than 24 weeks after the date of loan disbursement (the “Covered Period”).
Do you have to use all PPP loans in 8 weeks?
So my word of advice – unless you know for certain that you followed all the PPP guidelines and rules and will be fully forgiven under the original 8-week Covered Period (assuming you had a PPP loan prior to June 5th) then go with the 24-week period to be safe.
How long can you spend a PPP loan?
The eight-week period to use your PPP funds was extended to 24 weeks. Previously, you had to spend at least 75% of the funds on payroll. You now need to spend only 60% of the funds on payroll.
Can you use 12 weeks for PPP loan forgiveness?
Seasonal Employers: A seasonal employer that elects to use a 12-week period between May 1, 2019, and September 15, 2019, to calculate its maximum PPP loan amount must use the same 12-week period as the reference period for calculation of any reduction in the amount of loan forgiveness.
What if I do not use all of my PPP loan?
Yes, you can still receive loan forgiveness if you don’t spend all of your first or second draw PPP loan. … You may still be eligible for partial loan forgiveness, given that you can show that 60% of the forgiven portion goes towards payroll and the other 40% is used on other approved expenses.
Can I use 100% of my PPP loan for payroll?
The 60/40 rule states that 60% of your PPP loan must be used on payroll costs, and the remaining 40% can be used on other eligible expenses (rent, mortgage interest, utilities, etc.). However, as a self-employed worker, you can claim all 100% of your PPP loan as payroll under compensation replacement.
What is the deadline for PPP loan forgiveness 2021?
First PPP Loan Forgiveness Deadline is August 30, 2021. If you obtained a PPP loan, your covered period starts on the day the loan money was deposited. The covered period length could be from 8 to 24 weeks.
Can owners salary be included in PPP?
When it comes to the PPP, your payroll will be limited to the wages that you are taxed on. … This will not be owner draws, distributions, or loans to shareholders, because none of those types of transactions are subject to payroll or self-employment tax.
Do you have to wait 24 weeks for PPP forgiveness?
Borrowers may submit a loan forgiveness application any time before the maturity date of the loan, which is either two or five years from loan origination.
Will PPP loan forgiveness be extended?
Borrowers are able to defer paying back principal and interest on their PPP loans during the deferment period which, prior to the new rule, ended after the SBA issued a decision on the borrower’s loan forgiveness application. … New loans under the Program are no longer being advanced as of May 31, 2021.