|RTW Along with the Tax & Accounting Profession Association Members are Pushing To Make PPP Loans Forgivable. |
Many small businesses will be hit with a surprise PPP-related tax bill unless Congress acts soon. In the Coronavirus Aid, Relief and Economic Security (CARES) Act, Congress clearly intended for recipients of forgiven PPP loans to be able to deduct otherwise-deductible expenses associated with those loans for tax purposes.
OSCPA has joined the AICPA in encouraging members to ask their representatives to pass legislation allowing small business owners to deduct expenses paid with Paycheck Protection Program forgiven loans.
But the IRS has contradicted congressional intent. It has declared that borrowers who expect their PPP loan to be forgiven cannot deduct those expenses on their federal tax returns. The AICPA has already expressed its opposition and engaged with Congress and Treasury to work to ensure that PPP expenses are deductible.
Tell your members of Congress to support small businesses by quickly passing S. 3612 and H.R. 6821, the Small Business Expense Protection Acts of 2020, or H.R.6754, the Protecting the Paycheck Protection Program Act.
To find the name and address of your Representative, click on the words “Take Action” below!
Paycheck Protection Program Tax Deductibility
On April 30, the IRS issued a ruling that business recipients of Paycheck Protection Program loans that have been forgiven cannot deduct wages and related expenses as a business expense, significantly lessening the benefit of this important small business relief program. If you are concerned about this IRS decision, please reach out to your federal elected officials urging them to take action!
Passing this legislation as soon as possible will allow small businesses more certainty as they focus on year-end business planning that is especially important in these challenging economic times.
Stay Tuned For RTW’s Upcoming Webinar on How This Will Impact Your Taxes!