Yesterday, Wednesday 12/9, a bipartisan group of the US Congress released a summary of the proposed new Emergency Covid Relief Act of 2020. While this proposal is not yet law, and the White House has introduced a competing proposal, further negotiations are likely. However, the summary of this proposed new bipartisan legislation includes the following relief provisions:
- An additional $300 billion to the SBA (Small Business Administration) for second PPP loans to small businesses impacted by the Covid-19 pandemic who have 300 or fewer employers and have suffered a 30% revenue loss in any quarter of 2020.
- Business expenses paid for with the proceeds of the PPP loan will be tax deductible, consistent with Congressional intent under the earlier CARES Act, and even though PPP loan forgiveness is already not taxable income, resolving what has been a point of contention between Congress, the Internal Revenue Service, and tax experts.
- PPP loan forgiveness would be further simplified for those small businesses with PPP loans of $150,000 or less.
- The federal government would provide a $300 weekly supplement to state unemployment benefits for an additional 16 weeks (under the proposal, this increase would not be retroactive).
It is still anyone’s guess what any final federal COVID relief legislation will look like, but S&E continues to monitor developments in this area and will keep you informed.
