GettyThe IRS ruled that a Paycheck Protection Program (PPP) borrower who spends PPP funds on normal business expenses cannot deduct those expenditures for federal tax purposes. But as far as these congressional leaders are concerned, that’s a bad thing, not a good thing. The purpose of the PPP loan initiative, they argue, was to provide economic—specifically tax—benefits to businesses in order to make it possible to keep workers on the payroll. Whether section 265 is enough to ground the IRS’s position, or whether future legislation or judicial challenges will alter its course, remains to be seen. The IRS’s stance on PPP deductions will likely not be the last word.

Source: Forbes May 06, 2020 04:52 UTC