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Something different out of election news

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Sen. John Cornyn (R-TX), a member of the Senate Finance Committee, defeated Democratic challenger M.J. Heger in the Nov. 3 election. A new four-year term will give Cornyn more time to push the Small Business Expense Protection Act of 2020 (S. 3612), which would allow businesses to deduct expenses associated with their PPP loans. The legislation has the backing of Finance Committee Chair Chuck Grassley (R-IA), ranking member Ron Wyden (D-OR) and House Ways and Means Committee Chair Richard Neal (D-MA).
A bit of background:
The CARES Act was written indicating the PPP grant (forgivable loan) funds had no tax consequences. This was interpreted by IRS and US Treasury that you would not have to claim it as income, however you could not deduct the expenses it covered (which is the same thing). So us accountants would post the PPP as a contra-expense; so it reduces expenses/increases income. The Congress finance committees that worked on the CARES Act indicated they do not agree with IRS/US Treasury interpretation and will seek additional legislation to clarify their stance. {{{This is a GOOD THING}}}

 

 

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