Please note that this blog is based on laws effective on April 30, 2020 and may not contain later amendments. Please contact Cray Kaiser for most recent information.
On Thursday, April 30 the IRS announced in Notice 2020-32 that expenses paid using forgiven Payroll Protection Plan (PPP) loans are not deductible. The IRS is clearly seeking to eliminate a potential double tax benefit.
As you recall from our prior posts, forgiven PPP loans are not considered taxable income. The Notice makes clear that companies cannot “double dip” and use forgiven PPP loans to generate a tax deduction. At the end of the day, this means that the tax benefits originally touted are now eliminated.
It is possible that Congress could override the IRS interpretation. Like everything else with the CARES Act, we suggest you stay tuned to see if the IRS position will be the final rule. Cray Kaiser will keep our blog updated with the latest news and inform you via email as soon as we know more.
If you have any questions about the PPP loans, please contact Cray Kaiser today at 630-953-4900.
CK OFFICE OPERATIONS
These are certainly trying times and we want to reiterate that Cray Kaiser is here for you. As things continue to evolve in light of the COVID-19 pandemic, we at CK are taking additional precautions for the benefit of our team members and our clients.
- No clients or guests will be allowed in our suite.
- All in-person meetings are cancelled. Instead, we will be utilizing phone calls and/or email to communicate with our clients.
- Our team members are being encouraged to work remotely. All staff are equipped with the appropriate technology and resources to continue to securely and confidentially serve you from home.
- We will no longer have in-person drop offs of accounting/tax data. Instead, please drop off any packages outside the office door of our suite in the box provided.
- All paper files, tax returns etc. will no longer be mailed by our office to you. We will be holding these items in our office to send to you at a later date.
CK PORTAL ACCESS
We want to remind our clients of our portal access and your ability to safely and securely share your information with our team. We ask that you email email@example.com to request your portal access. This will eliminate the need for you to drop off your tax information at our office.
Thank you for your patience and understanding during this challenging time. We wish you, your family, and your business health and safety. We will continue to support you as best as we can while keeping each other’s health a priority. If any changes occur during the course of the next few days, we will update our website.