Tax Update Blog

Confirmed: PPP expenses deductible in new COVID deal

Blog
By Joe Kristan

The legislative text of the COVID deal reached last night has been released. It comes in at 5,593 pages; click here to see it, if you dare

The bill overturns the Treasury position that the expenses that give rise to forgiveness of PPP income are not deductible. The provision specifies that the PPP forgiveness is treated as debt forgiveness income. The IRS had floated a theory that it would instead be an expense reimbursement.

There are no limits to the amount of expenses deductible under this provision. There were rumors that the deduction might be limited for some taxpayers, but no limits appear in the bill language.

The PPP expense language from the bill:

Text of PPP forgiveness taxability in COVID bill

Prior coverage: Congress reaches deal on COVID relief, PPP deductions (Updated). 

 


Stay informed!


This is a roundup of tax news and opinion. Any opinions expressed or implied are those of the author and not necessarily those of Eide Bailly. Opinions found in linked items are those of the authors of the linked item, not of your bloggers or of Eide Bailly. “$” means link may be behind a paywall. Items here do not constitute tax advice.