Covid Relief Package May Exempt Borrowers from Paying Tax on PPP Loans
New York, NY, December 21, 2020-The new Coronavirus relief bill could clear Paycheck Protection Program (PPP) borrowers from paying tax on their loans.
According to PPP Borrower Tax Relief Under Stimulus Bill – It’s Finally Happening” by Alan Gassman, “Congress is acting today to allow PPP borrowers to deduct PPP expenses, and not have to include loan forgiveness in income. And the shareholders of S corporations will enjoy another benefit that is described below.
“Possible bad news for many is that those borrowers who have received final forgiveness before the bill is signed into law will not be sure whether they can deduct the expenses or not, because the new saving provision described below may not apply to them. That would quite likely change after passing by technical correction due to the outcry that would obviously occur if this is the case.
“The good news for most PPP borrowers is that the proposed bill allows for the deduction of these expenses, and for loan forgiveness to not be included in income. And borrowers that are S corporations will enjoy another benefit that is described below, as now written.”