The changes keep coming. Just when I thought I was going to run out of things to write about, here’s even more new developments.
No End Date For Forgiveness
Borrowers have until March 31, 2021 to apply for a first or second draw, but no ending date has been set for forgiveness. The initial PPP Loan package gave borrowers up to ten months following their covered period to apply for forgiveness. The new package has not yet set a date. I would presume that this will be forthcoming.
New Expenses Are Now Covered
Additional items that can be included in forgiveness are
1 – Expenses for cloud computing
2 – Damages pertaining the the looting and riots that were sustained last year
3 – Safety gear that has become necessary as a result of the virus
Forgiven PPP Expenses Are Deductible
The IRS has officially reversed its prior opinion. Expenses used in PPP Loan forgiveness are now fully deductible under the rules of Generally Accepted Taxation Principles.
Streamlined Forgiveness For Small Borrowers
We still don’t know all of the details, because they are yet to release the new forms, but supposedly it will be easier to receive forgiveness. I will follow up on this. Stay tuned.
EIDL Grants No Longer Count Against Forgiveness
There was another $20B inside the PPP2 Bill creating another round of EIDL Grants. One of the problems we had with the old bill was that the amount received on the grant reduced the amount of PPP Forgiveness available. This is no longer the case.
What we’re going to do about the loans that we had forgiven prior to this, where they still have an amount due because of the grant is anyone’s guess. We’ll see what they instruct us to do. The final findings on the PPP2 Legislations are due by January 21st.
Let me leave you with this.
Our incoming President unveiled a new stimulus package that will supposedly be submitted to Congress for approval on the day that he is sworn in. It’s a $1.9B package that includes a federally mandated $15 minimum wage, direct payments to American families, and more additional unemployment benefits.
He has already stated proudly that he will be raising taxes.
One thing is certain. Tax planning will become even more important than ever before. I have a sneaking suspicion that this is going to get ugly rather quickly. Democracies are built on the backs of the middle class.
Don’t tease yourselves my friends. They’re coming. No matter what they say at political rallies to get your vote, it’s rarely true. They’re coming.
The only thing between your bank account and them is our ability to legally reduce your tax burdens.
The next four years of my life are going to be difficult. If you’ve ever been forced to sit with a middle class family and explain to them that they need to pay taxes that will literally take bread out of the mouths of their children, then you begin to know what I mean.
Your accounting and tax work will be more important than ever. We’re all going to get through this. Let’s get through it together.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. If there is ever anything you need, whether you’re a current client or not, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
www.AccountingSolutionsLtd.com
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