Restaurant operators who had Payroll Protection Program (PPP) loans forgiven may lose some key tax deductions, creating a surprise tax liability. The majority of restaurants might not be eligible for a new round of PPP funding? These two critical issues are why you need to take action now.
As Congress tries to move towards agreement on a final COVID relief package, plans have emerged for a new round of PPP funding that would require businesses to demonstrate a 50% loss of revenue. According to recently released data, 55% of restaurants that are losing money would not be eligible for this new funding! Congress must fix the legislation to ensure that more restaurants—the hardest hit businesses by the COVID-19 pandemic—are eligible.
When Congress created PPP, its intent was for business expenses paid by PPP to be tax deductible. However, guidance from the IRS says that expenses paid for with a forgiven loan are now taxable.
Congress must make business expenses paid for by PPP tax deductible.
Congress needs to hear from restaurants now. Negotiations are ongoing for this final relief package and time is of the essence!
The Connecticut Restaurant Association launched the CT RESTAURANT PROMISE, our pledge from restaurants to the Connecticut public! Over 500 restaurants have already signed the pledge and we encourage every restaurant to “Take The Promise,” which continues to highlight the exceptional efforts being made to protect our employees and customers!