If your business received SBA PPP loan funds here’s what you need to know to prepare for your 2020 taxes.
As with all elements of the forgivable loan, there are steps you should take right now to ensure forgiveness and compliance. In the video below we’ve outlined several scenarios to beware of, as well as suggestions for making the process more efficient and less likely to trigger an audit.
Elements to keep in mind:
- At least 75% of all PPP funding must be used to cover payroll expenses for your employees.
- No more than 25% of the loan can be used to cover costs associated with utilities, interest, and other business-related expenses.
- No expenses paid with PPP loan funds can be deducted from your 2020 tax returns.
If you have questions about complex tax law issues or if you need assistance organizing your application to qualify for the PPP loan, please contact a representative at Milikowsky Tax Law.