Best Practices for Applying for PPP Loan Forgiveness
With the current pandemic the world is facing today, many people are faced with financial problems, especially those who own a small business. Fortunately, the federal government knows the struggle of small business owners, including those who are self-employed and have created a Paycheck Protection Program or PPP loan program. It is an SBA loan program under the SBA 1 program and has an approved law on March 27 2020. On June 5, 2020, the President signed the PPP Flexibility Act and on June 16 this year, the treasury released PPP Loan Forgiveness application and the instruction along with it.
What is a PPP loan?
Paycheck Protection Program or PPP allows business owners and self-employed individuals to apply for a loan 2 times their average monthly payroll. Once the loan is released, they should spend it on an allotted time but on approved expenses such as payroll, mortgage interest, and rent and utility bills. In doing so, they can apply for PPP loan forgiveness which gives them the chance to get their entire loan amount forgiven. However, before you apply for loan forgiveness, you should provide the required documentation.
Your lender will have 60 days or approximately two months to respond to your application for forgiveness and typically will agree with it. If there are balances not forgiven, it will become a loan that you need to pay for up to 2 years with only 1% interest rate. The best part of the Paycheck Protection Program or PPP loan forgiveness is that 100% of the loan can be forgiven – provided that you meet their criteria and requirements.
Should you do the filing for PPP loan forgiveness?
Paycheck Protection Program or PPP loans can be a big help for small businesses, especially during these trying times. If you comply with all the requirements and meet the criteria, you can have your loan forgiven but the entire process can be puzzling. That is why most business owners and self-employed individuals choose to hire a professional bookkeeper when applying for PPP loan forgiveness. Doing it yourself may seem exciting and fulfilling but since you are applying for loan forgiveness, there is no room for mistake.
Why hire bookkeepers?
Small business owners may find the application process tiresome and grueling, not to mention, the chance of missing the criteria and certain requirements. Hiring a professional bookkeeper can give you a guarantee that your application will be approved and will be filed earlier than your expected time. Remember, the law for Paycheck Protection Program can change from time to time but with a bookkeeper, you can be sure that you will be updated with such changes as they are always on the lookout for revisions and changes.
PPP loans have been a lifesaver for small businesses but there are still problems that you need to face so hiring a bookkeeper will ensure that you can overcome it such as getting approved for a PPP loan