POSTED ON MONDAY, July 20, 2020
Home-based care providers were under the impression the loans they received under the Paycheck Protection Program (PPP) would be nontaxable, but it appears that may not be the case.
“Congress clearly intended that PPP funds would be nontaxable,” Leon LaBrecque — a lawyer, accountant and chief growth officer at Sequoia Financial Group — told Home Health Care News. “[But] the IRS has ruled that expenses associated with the generation of tax-free income is not deductible.””
Congress and the IRS clearly are looking at the funds from the CARES Act from different vantage points. “Even though the money isn’t considered taxable income, per the CARES Act, expenses associated with the loans can’t be deducted from a recipient’s income, according to Bill Sanders, a shareholder and tax group chair at the law firm Polsinelli.”
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