Obermayer (Pennsylvania): COVID-19 And CARES Act: PPP Loan Forgiveness Expenses Are Not Tax Deductible. Wait! Really?

The IRS recently announced that business expenses paid to qualify for loan forgiveness under the Paycheck Protection Program of the CARES Act (PPP) are not deductible. For details about the PPP please click here. This agency decision “prevents a double tax benefit” since loans forgiven under the program are not included in the borrower’s taxable income. By taking this position, the IRS eliminated some extra benefits borrowers would have received under a program that was intended to help small business maintain liquidity during the COVID-19 pandemic. MORE.

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