Has your business received a PPP, EIDL, or other SBA loan this year? These loans are not taxable as income; however, tax planning may be especially important regarding the PPP loan. The most recent IRS rulings have determined that eligible expenses paid by PPP funds are non-deductible, which will significantly increase 2020 net income and tax liability.
We are still waiting for more guidance on this. The intent of Congress was to make the expenses deductible, but the IRS says otherwise. We will keep you informed if anything changes, and feel free to contact your Tax Manager.