Category: Timely Opportunities
The Senate and House of Representatives overwhelmingly passed a $900 billion COVID-19 relief bill yesterday which provides a $600 stimulus to individuals as well as other tax benefits. Here are just a few highlights:
Simplification of PPP Forgiveness Applications:
Tax deductibility for PPP expenses
We have been waiting for this. Now business expenses paid with forgiven PPP loans are tax-deductible. This supersedes previous IRS guidance that such expenses could not be deducted. This rule change may affect the tax projections that your KB accountant previously prepared, so make sure to contact him or her if you have questions regarding your tax liability for 2020.
Additionally, if you have an S-corporation, and the PPP forgiveness and non-taxability brings your company into a loss position, make sure that you have enough basis to take the loss. This is a little technicality so please check with your KB CPA for more information on this aspect of tax planning.
Income Tax Changes:
Medical expenses; the itemized deduction floor is now permanently set at 7.50% of AGI
We will continue to update you on this important legislation as more information becomes available.
If you have any questions please contact your Kerkering Barberio team member at 941-365-4617.
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