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A Closer Look at When Nondeductible Expenses from PPP Loans Impact Taxable Income
Posted by Chrissy Hammond on Fri, Nov 13, 2020 @ 08:00 AM

As businesses continue to grapple with effects from the COVID-19 pandemic, many are turning attention to forgiveness of Payroll Protection Program (PPP) loans. Borrowers do not need to repay PPP loans as long as they satisfy a variety of conditions, including a requirement to spend PPP loan proceeds on qualifying expenditures such as payroll and rent. The IRS previously clarified in Notice 2020-32 that these expenditures are nondeductible for tax purposes. But in many cases, PPP loans will not be forgiven by the end of the tax year. In that case, it is uncertain how to treat the expenditures in the year incurred, and what to do in the year of loan forgiveness.

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Topics: COVID19, Coronavirus, PPP Loan, payment protection plan, PPP Loan Forgiveness, Nondeductible Expenses

A Loan Recipient's Guide to PPP Loan Forgiveness
Posted by Chrissy Hammond on Fri, Jul 10, 2020 @ 12:41 PM

Paycheck Protection Program (PPP) loan recipients will be under scrutiny when applying for forgiveness, which makes conscientious recordkeeping essential. Extensive documentation is needed for loan forgiveness applications to verify that loans are being used for their primary intended purpose: to retain the workforce and maintain payroll costs.

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Topics: COVID19, Coronavirus, PPP Loan, payment protection plan, PPP Loan Forgiveness

AICPA Weighs in on Accounting for PPP Loans
Posted by Chrissy Hammond on Wed, Jun 17, 2020 @ 11:57 AM

Companies will have a little more accounting guidance to go on when it comes to the accounting for their Paycheck Protection Program (PPP) loans. The American Institute of Certified Public Accounts (AICPA) recently weighed in on the matter, providing guidelines that companies could follow for their potentially forgivable government loans.

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Topics: AICPA, COVID19, Coronavirus, PPP Loan, payment protection plan

How the New PPP Law Affects Loan Forgiveness Requirements
Posted by Jenna Peabody on Mon, Jun 8, 2020 @ 11:01 AM

Changes have been made to the Paycheck Protection Program (PPP) to give loan recipients more leeway to qualify for loan forgiveness. President Trump signed the Paycheck Protection Program Flexibility Act (PPPFA) into law after the House and Senate passed it last week.

In addition to providing more breathing room for the loan forgiveness requirements, the PPPFA increases the minimum loan maturity date to five years for PPP loan balances not forgiven. The following takes a deeper dive into what the PPP loan forgiveness requirement now looks like.

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Topics: Donald Trump, Trump, CARES Act, PPP, payment protection plan, SBA, Small Business Administration, PPPFA, payment protection plan flexibility act, loan forgiveness

Accounting Considerations for the Paycheck Protection Program
Posted by Chrissy Hammond on Tue, Jun 2, 2020 @ 07:45 AM

As the dust settles on Paycheck Protection Program (PPP), organizations that received the forgivable loans face accounting questions. The program instituted by the Coronavirus Aid, Relief, and Economic Security (CARES) Act provides full or partial forgiveness on loans in an effort to help organizations struggling to cover payroll expenses due to the disruption of the COVID-19 virus. While financial institutions facilitate the loans, the Small Business Administration (SBA) reimburses them.

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Topics: COVID19, Coronavirus, CARES Act, Coronavirus Aid, Relief, and Economic Security Act, PPP Loan, payment protection plan

House Overwhelmingly Passes Bipartisan Measure to Ease PPP Loan Forgiveness Requirements with Senate Prepared to Act Quickly
Posted by Chrissy Hammond on Mon, Jun 1, 2020 @ 07:01 PM

On May 28 the House of Representatives passed H.R. 7010, the Paycheck Protection Program Flexibility Act of 2020 (PPPFA). The legislation passed 417-1 with overwhelming bipartisan support.  Senate Majority Leader Mitch McConnell will attempt to expedite passage in the Senate by seeking unanimous consent, he announced June 1.

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Topics: FASB, COVID19, Coronavirus, CARES Act, Coronavirus Aid, Relief, and Economic Security Act, PPP Loan, payment protection plan

SBA’s Updated Paycheck Protection Program FAQ Brings Additional Questions
Posted by Kevin Higgins on Thu, May 14, 2020 @ 08:12 PM

One day before the deadline to return Paycheck Protection Program Funds, the Small Business Administration (SBA) updated its loan program’s frequently asked questions to create a safe harbor for recipients of loans of $2 million or less. The last minute safe harbor addition provides relief, but it also raised some additional questions, particularly coming so close to a major deadline.

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Topics: COVID19, Coronavirus, CARES Act, Coronavirus Aid, Relief, and Economic Security Act, PPP, PPP Loan, payment protection plan, SBA, Small Business Administration

Managing the Paycheck Protection Program Loan Guidance: Your Questions Answered
Posted by Chrissy Hammond on Thu, May 14, 2020 @ 03:37 PM

Guidance around the Small Business Administration’s Paycheck Protection Program continues to evolve, particularly as details emerged that the first recipients of the partially forgivable loans went to larger organizations. The Treasury released an updated Q&A document in May, announced it would be reviewing all large loans and spot-checking the smaller distributions, and provided a deadline for organizations to return any PPP funds for which the organization did not qualify.

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Topics: COVID19, Coronavirus, CARES Act, Coronavirus Aid, Relief, and Economic Security Act, PPP, PPP Loan, payment protection plan

Received a PPP Loan? Prepare for Scrutiny
Posted by Chrissy Hammond on Fri, May 1, 2020 @ 01:06 PM

The roll out of the Paycheck Protection Program (PPP) loans triggered a rush for funding at the end of March. The $349 billion in funding for the program provided by the Coronavirus Aid, Relief, and Economic Security (CARES) Act ran out mid-month, and President Trump signed a stopgap measure to provide an additional $320 billion in funding on April 24.

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Topics: COVID19, Coronavirus, CARES Act, Coronavirus Aid, Relief, and Economic Security Act, PPP Loan, payment protection plan

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