Small businesses that have borrowed under the Small Business Administration’s Payroll Protection Program must apply for forgiveness soon, or the loans will become permanent and businesses will be liable for payments and interest.
PPP loans are automatically converted to a standard loan at 1% per annum unless the small business applies for forgiveness from the SBA within 10 months of the end of the coverage period during which they had to spend the money. For some businesses, there was an eight-week covered period at the start of the program when it launched in April 2020, with the result that the deadline was mid-July. For most loans that are in the more popular 24-week coverage period, this could mean a September deadline.
In any case, according to experts, small businesses should apply as soon as possible to avoid unnecessary costs.
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