Long-awaited guidance from the IRS released late 11/18/20 is not very favorable for taxpayers on the issue of the non-deductibility of expenses related to PPP loans.
Based upon this latest guidance, the IRS is clearly stating that the expenses associated with PPP are non-deductible in 2020.
The IRS also stated in this most recent release that if you have a reasonable basis to assume you will be granted forgiveness, regardless of whether you have applied or applied and not received forgiveness, these expenses are non-deductible in 2020.
There is expected to be more guidance and possible legislation that may update this most recent guidance from the IRS.
It goes without saying that tax planning just got significantly more complex and businesses must plan accordingly.
Please contact Doty Pruett Wilson, certified public accountants, to discuss your individual situation: 503-362-9152