The controversy over the deductibility of payroll expenses by Paycheck Protection Program (PPP) loan recipients has finally been settled, less than a week before the end of the year. The Consolidated Appropriations Act, 2021, signed into law Dec. 27, 2020, allows deductibility of ... [+] payroll expenses by Paycheck Protection Program loan recipients. Businesses can deduct payroll and other business expenses as usual, even if these expenses are paid for with PPP loans. Under the just-enacted law, PPP loan recipients are treated no differently than non-PPP loan recipients when it comes to taking tax deductions for business expenses. That goes for 2020 and future tax returns, whether a PPP loan recipient’s loan is forgiven this year, next year, or never.

Source: Forbes December 29, 2020 22:52 UTC