Chief Executive Officer and Founder of Stern & Eisenberg
At Stern & Eisenberg, we are always looking for ways to grow and enhance our ability to support all of our clients’ needs through our existing footprint. Part of our effort includes supporting our attorneys’ efforts to develop their abilities and knowledge in additional jurisdictions.
It is with great pleasure to announce that Steven K. Eisenberg has recently been sworn into the practice of law in the additional states of West Virginia and Maryland. He looks forward to working with the other Stern & Eisenberg attorneys licensed in those states. With the help of our Stern & Eisenberg attorneys, Steven soon will join the Federal Bars (District Courts and Bankruptcy Courts) in both states. Steven is also finalizing his admission to the New York State Bar.
The S&E family is dedicated to professional advocacy, creative solutions and legal services for our clients, partners, and community with determined integrity and intensity serving the State of Delaware, Pennsylvania, New Jersey, New York, Pennsylvania, West Virginia and (Maryland).
Steven K. Eisenberg, Chief Executive Office and Founder of Stern & Eisenberg has an extensive background in real estate and corporate matters including acquisition and sale of businesses and assets. His practice also focuses on the representation of lenders and servicers in the enforcement and protection of their interests in the legal process, including foreclosure, bankruptcy, evictions, title claims, loan modifications, and litigation. Having experience previously representing borrowers, Steven brings his unique perspective to the representation of his servicer, lender and business clients. Steven is now licensed to practice law in New Jersey, Pennsylvania, West Virginia, Maryland, and the District of Columbia. He is Martindale-Hubbell AV rated.
While the IRS has taken the position (IRS Notice 2020-32) that qualified expenses paid using PPP loan proceeds are not deductible for federal income tax purposes, the issue is far from resolved and the subject of continued debate. Click here for more information.
While the IRS has taken the position (IRS Notice 2020-32) that qualified expenses paid using PPP loan proceeds are not deductible for federal income tax purposes, the issue is far from resolved and the subject of continued debate.
In a letter to Congress on August 4, 2020, copy available here, https://www.ada.org/~/media/ADA/Advocacy/Files/200804_Main_Street_Loan_Forgiveness.pdf?la=en, a consortium of some 170 business interests and lobbying groups (ranging from the Air Conditioner Contractors of America to the American Dental Association, and including the American Institute of CPAs) demanded that any new COVID-19 relief legislation affirm the deductibility of these qualified expenses (i.e. wages and rents paid using PPP loan proceeds).
Why is this issue crucial to small business PPP borrowers? Because any PPP loan forgiveness may be effectively negated if qualified expenses paid with forgiven PPP loan proceeds are not tax deductible. As their letter notes as an example, “If a business has $100,000 of PPP loans forgiven and excluded from its income, but then is required to add back $100,000 of denied business expenses, the result is the same as if the loan forgiveness was fully taxable.” Proposals have been introduced in Congress to “reverse” the IRS position. However, currently all COVID-19 relief efforts are stalled. A real practical concern raised by those concerned with this issue is that with the extension of the time to use PPP loan proceeds to 24 weeks, a small business using PPP loan proceeds for qualified expenses in 2020 may not obtain forgiveness until sometime well into 2021. Without that forgiveness in hand, can that business deduct the qualified expenses paid using loan proceeds in 2020?
In the absence of further relief or guidance on this issue, small business taxpayers and their tax advisors will have to decide whether to take an aggressive approach, in light of IRS Notice 2020-32, or comply with the IRS’s position and face losing most or all of the benefits of PPP loan forgiveness. We continue to monitor developments in this area, and will provide updates on these critical issues as they become available.
Since being signed into law on March 27, 2020, the federal CARES (the Coronavirus Aid, Relief and Economic Security Act) established a comprehensive COVID-19 related financial support package for individuals and small businesses (those businesses with up to 500 employees). The primary SBA COVID-19 related support programs are the SBA PPP (Paycheck Protection Program) and the SBA EIDL (Economic Injury Disaster Loan program). The CARES Act provided for an initial round of funding of $349 billion for the PPP and $10 billion for the EIDL program. Unfortunately, the initial funding for both programs was exhausted in 2 weeks. Many small business owners have reached out to us concerned that they lost the ability to participate in these programs. However, we are happy to report that, last night, the House passed H.R. 266, The Paycheck Protection Program and Healthcare Enhancement Act. President Trump signed this new bill this morning. It provides for additional PPP funding of $310 billion and additional EIDL program funding of $60 billion ($50 billion for disaster loans including EIDL loans and $10 billion for grants). As many applications were “in the pipeline” when the initial funding for these programs was exhausted, it is expected many of those pending applications will be processed first, and it is therefore imperative if you have not applied for these programs that you move quickly if you want to take advantage of these SBA COVID-19 related loan programs. We can help. For more information, please click here to contact us and speak with one of our attorneys.
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Phone: (215) 572-8111
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Stern & Eisenberg is a leading, regional, full-service law firm. For over forty years, Stern & Eisenberg has built a collaborative, diverse, high-performing team environment which promotes data-driven decision-making, creates innovative opportunities, and allows for performance, operational, and technological seamlessness across its multi-state footprint. Click here to contact the S&E Value Department.