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– IRS Interpretation on Taxability of PPP Loans is Opposed

Tue, May 05, 2020 1:38 PM | Anonymous member (Administrator)

CIRT has joined an AGC lead coalition of design and construction industry associations/groups to call attention to an IRS notice issued regarding taxable aspects of the Covid-19 (Wuhan virus) relief package.  The Internal Revenue Service (IRS) issued Notice 2020-32 is at odds with the legislative text of the CARES Act.  Section 1106(i) of the Act states with regard to the “taxability” of the loan forgiveness available to PPP recipients, any amounts forgiven by a PPP loan “shall be excluded from gross income” (emphasis added). The impact of the IRS’s interpretation is to undue not only the intent but the effect of the Congressionally passed provision, thus undermining the value of the loan program by increasing the taxes companies will owe in the future.  [Details see Letter to U.S. Congress re: IRS].

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