Businesses Get $100 Billion Tax-Write-off Windfall in Aid Bill

Bill would override IRS’s denial of expense write-offs

Small business owners who got Paycheck Protection Program loans could qualify for big write-offs from their rescue money, amounting to what Treasury Secretary Steven Mnuchin has called a tax-break “double dip.”
The Covid-19 relief package set for a vote in Congress would clarify that business owners can deduct expenses paid for with PPP loans, which can be forgiven by the government without incurring a tax. The deduction benefit could generate more than $100 billion in tax savings for business owners, according to Brookings Institution estimates.
The legislation would override Mnuchin and the IRS, who have blocked businesses from writing off rent, utilities and other business expenses paid for with tax-free money. The agency says the tax code prohibits that sort of doubling up of tax benefits.
Lawmakers from both parties, including the top-ranking Democrats and Republicans on both the House and Senate tax committees, said they intended for business owners to qualify for those write-offs when they created PPP loans. The IRS said the law didn’t specify that. Congress could pass the new legislation as soon as Monday.

.https://www.bloomberg.com/news/articles/2020-12-21/businesses-get-100-billion-tax-write-off-windfall-in-aid-bill.

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Businesses Get $100 Billion Tax-Write-off Windfall in Aid Bill

Businesses Get $100 Billion Tax-Write-off Windfall in Aid Bill

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