COVID-19 Resources

Tax and Wealth Advisor Alert: Breaking News–IRS Says Expenses Paid with Forgiven PPP Loans are Deductible

Businesses can now deduct expenses paid for with the proceeds of a forgiven Paycheck Protection Program (PPP) loan. The IRS, in Revenue Ruling 2021-2 issued today, reversed its original position that prohibited businesses with PPP loans from “double-dipping” by paying expenses with a forgivable loan, then writing off those expenses. Congress, in the latest COVID-19 relief bill, as we explained further here, explicitly stated that such expenses were deductible, forcing the IRS to reverse course.

This ruling is sure to provide a significant tax benefit and relief for many small business owners who had availed themselves of the PPP program and found themselves saddled with unexpected tax liabilities as a result of the IRS’s original position.

O’Neil, Cannon, Hollman, DeJong and Laing remains open and will continue to monitor federal and state law tax changes. For questions or further information relating to taxation under the CARES Act and the new relief bill, please contact Attorney Britany E. Morrison.

Published by
Britany Morrison

Recent Posts

The WiLaw Quarterly Newsletter

Newsletter Article Highlights: A Beginner’s Guide to Trademarks: Part Two—USPTO Trademark Application Requirements What is…

3 days ago

Steve Slawinski and John Gehringer Recognized in Wisconsin Law Journal’s Power List

Recently, attorneys Steve Slawinski and John Gehringer were named in the Wisconsin Law Journal’s Power…

4 days ago

National Estate Planning Awareness Week

October 21-27, 2024, is National Estate Planning Awareness Week—a timely reminder to think about your…

2 weeks ago

Attorney Maura Falk Has Joined O’Neil Cannon

Attorney Maura Falk, a graduate of the University of Wisconsin Law School, has joined O’Neil Cannon’s…

2 weeks ago

What is the Difference Between a Private Foundation and a Donor-Advised Fund?

When high-net-worth individuals and families incorporate charitable giving into their estate planning, they often consider…

3 weeks ago

Greg Lyons Honored for Saving Life

Attorney Greg Lyons was recently honored, along with others,  for his heroic actions in saving…

4 weeks ago