If you did not hear, you need to know – PPP expenses are deductible now after the passing of this last COVID stimulus package. We were all sitting on the edge of our seats for the last few months waiting for Congress to fix the deductibility for us, otherwise, all businesses were going to owe more taxes. We can now all breathe easy and know we will not have that extra tax burden.
The expenses you paid using your PPP loan are now deductible, and the forgiveness of the loan will not be taxable income. You will record all the expenses as you normally would for any other expenses, and you will set up another income account for the PPP Loan forgiveness once you get that approval letter from the SBA. In most cases, if you are a calendar year tax filer, we do recommend the expenses and income both be recorded in 2020. If you are a fiscal year end, please consult your tax advisor.
If you have any questions on this, please reach out to any of our Leadership Team.
December 29, 2020