As I write this, it’s Thursday the 17th, and it looks like Congress has made a massive compromise, and it really impacts taxation, which is the point that i’m trying to make. They’ve stripped out a lot of the big things that both sides wanted. Everybody seemed to want individual checks for people and help for states and localities to distribute the COVID-19 vaccine, and we’ve got a lot of things like that. But there’s not going to be any individual bailout money for big states and localities, nor will there be liability protection for businesses, which would seem to be a big win for the litigation industry. Unfortunately, it also seems pretty clear now that the the PPP Loan Forgiveness will actually be taxable, not the loan itself, but they’re denying the deductibility of anything that you paid with that, so that essentially makes the forgiveness of the loan taxable. Pretty disappointing! You’d think that would be something both sides could agree upon, but who knows what the new Congress will do.
One piece of advice might be to give Congress time to get its sea legs, and give them a chance to pass that sometime in the spring. Looks like 2021 might be a good year to extend and wait and see what happens. Don’t forget to make your estimated payments in the meantime. If you’ve got any questions or if you need us to help you analyze your books, just let us know!