May 7, 2020 3:20 a.m.
Oregon Senator Ron Wyden has introduced a bill he said would clarify small business expense deductions under the Paycheck Protection Program.
Wyden said he wants to make sure small businesses can deduct expenses paid with a forgiven PPP loan, from their taxes.
Wyden said “Treasury’s guidance barring deductions for expenses paid by PPP loans is a gut punch for businesses struggling to stay afloat”. He said it defies commonsense for Treasury to provide help on the front end, but then take it away on the back end. He said the Small Business Expense Protection Act would “fix this mistake and ensure businesses feel confident using PPP funds to keep their workers employed”.
The release said the Paycheck Protection Program was created in the CARES Act to maximize small businesses’ ability to maintain liquidity, retain their employees, and recover from the pandemic as soon as possible. Last Thursday, the Internal Revenue Service issued a notice that said small businesses cannot deduct those business expenses, according to Wyden. He claims the notice is contrary to congressional intent.
The release said four others senators have joined Wyden in introducing the legislation. It is supported by the American Institute of Certified Public Accountants, according to Wyden.