New PPP Loan Clarification from the IRS
Did you receive a Paycheck Protection Program (PPP) loan in tax year 2020?
Has your loan been forgiven in 2020 or expected to be forgiven in 2021?
Has your request for forgiveness been denied?
Are your eligible expenses deductible?
The questions could go on and on! As a business owner there is an overwhelming amount of information and rules to keep up with concerning the PPP Loan. We know! And even as CPAs it can be daunting.
In case you haven’t heard, the IRS recently issued clarification regarding the PPP Loan. Here are two new important facts to know:
- The IRS is upholding that no deduction is allowed in 2020 for an eligible expense if the payment of the eligible expense results in forgiveness of a covered loan.
- The IRS provided a safe harbor allowing for the deduction of eligible expenses in 2020 if the loan is not forgiven.
If these issues impact your business, contact PHB now to set up a tax planning consult for this new guidance. We love to share our expertise to help your business thrive!