{"id":1407,"date":"2020-01-15T06:30:07","date_gmt":"2020-01-15T12:30:07","guid":{"rendered":"https:\/\/www.insure-us.org\/blog\/?p=1407"},"modified":"2020-12-05T09:23:43","modified_gmt":"2020-12-05T15:23:43","slug":"ppp-loans-and-taxed-expenses","status":"publish","type":"post","link":"https:\/\/www.insure-us.org\/blog\/ppp-loans-and-taxed-expenses\/","title":{"rendered":"PPP loans and taxed expenses"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The IRS issued guidance in November clarifying the tax treatment of PPP loans that have not been forgiven by the end of the year the loan was received:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Businesses are not taxed on the proceeds of a forgiven PPP loan, so the expenses are not deductible.<br>This means that the taxpayer sees neither harm nor benefit, since the taxpayer has paid nothing out of pocket.<br>Here is how this looks on your tax return, according to bench.com:<br>A C-corporation receives $100,000 in a PPP loan, uses the money entirely on payroll and qualifies for loan forgiveness.<br>The $100,000 won&#8217;t be listed as taxable income on the tax return.<br>BUT, the tax deduction the business would normally get (about $21,000) won&#8217;t be allowable. So, surprise &#8212; you have an extra $21,000 tax liability (assuming 21 percent corporate tax). You did receive a net $79,000 from the program, which you have already spent, but which you might not have had otherwise.<\/li><li>Businesses are encouraged to file for forgiveness as soon as possible. If a business believes a PPP loan will be forgiven in the future, expenses related to the loan are not deductible, whether the business has filed for forgiveness or not.<\/li><li>If a PPP loan is expected to be forgiven but it is not, the business WILL be able to deduct expenses.<br>According to the CARES Act, a forgiven loan amount won&#8217;t be included in taxable income.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The IRS issued guidance in November clarifying the tax treatment of PPP loans that have not been forgiven by the end of the year the loan was received: Businesses are not taxed on the proceeds of a forgiven PPP loan, so the expenses are not deductible.This means that the taxpayer sees neither harm nor benefit, [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29,32],"tags":[],"class_list":["post-1407","post","type-post","status-publish","format-standard","hentry","category-business","category-general"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/posts\/1407","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/comments?post=1407"}],"version-history":[{"count":1,"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/posts\/1407\/revisions"}],"predecessor-version":[{"id":1408,"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/posts\/1407\/revisions\/1408"}],"wp:attachment":[{"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/media?parent=1407"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/categories?post=1407"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.insure-us.org\/blog\/wp-json\/wp\/v2\/tags?post=1407"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}