The AICPA urged Congress to take action on Paycheck Protection Program (PPP) issues, remove tax obstacles to remote work, support state and local governments, and adopt new coronavirus-related liability provisions in a letter to congressional leaders sent Monday.
“While the federal government’s efforts to date have blunted economic decline, the recent resurgence of reported coronavirus cases and the resulting economic impact highlight the urgent need for additional relief and recovery provisions — particularly those that assist small employers and their employees,” the AICPA wrote in a letter to Senate Majority Leader Mitch McConnell, R-Ky.; Senate Minority Leader Chuck Schumer, D-N.Y.; House Speaker Nancy Pelosi, D-Calif.; and House Minority Leader Kevin McCarthy, R-Calif.
The letter was sent as congressional leaders consider phase four federal legislation to address the pandemic.
The AICPA encouraged Congress to:
- Allow full deductions for PPP-related business expenses. The AICPA said the IRS contradicted Congress’s intent on April 30 in Notice 2020-32, which declared that no tax deduction is allowed for an expense that is otherwise deductible if the payment of the expense results in forgiveness of a PPP-covered loan.
- Provide information and tools to further simplify the PPP loan forgiveness application process. The AICPA supports proposed legislation that would require the U.S. Small Business Administration and Treasury to provide or certify free, publicly accessible PPP loan forgiveness calculators.
- Remove tax obstacles to remote work. The AICPA supports proposed legislation designed to balance states’ rights to tax income from work performed within their borders and the needs of individuals and businesses, especially small businesses, to operate efficiently.
- Allow Sec. 501(c)(6) associations and organizations access to PPP. Not-for-profits organized under Sec. 501(c)(6) of the Internal Revenue Code are ineligible for assistance through the PPP. Many of these organizations are small, state-based, and regional entities — including state CPA societies — that are suffering from event cancellations and reduced meeting attendance.
- Provide additional federal fiscal relief to state and local governments. Without appropriate federal assistance, state budget shortfalls could trigger new state taxes on already struggling small businesses to close budget gaps, the AICPA said.
- Adopt new coronavirus-related liability provisions. The AICPA is calling for temporary and targeted liability protections for employers designed to prevent meritless coronavirus-related lawsuits against employers without diminishing key worker protections.
AICPA experts discuss the latest on the PPP and other small business aid programs during a weekly virtual town hall. The webcasts, which provide CPE credit, are free to AICPA members. Go to the AICPA Town Hall Series webpage for more information and to register.
The AICPA’s Paycheck Protection Program Resources page houses resources and tools produced by the AICPA to help address the economic impact of the coronavirus.
For more news and reporting on the coronavirus and how CPAs can handle challenges related to the outbreak, visit the JofA’s coronavirus resources page or subscribe to our email alerts for breaking PPP news.
— Ken Tysiac (Kenneth.Tysiac@aicpa-cima.com) is the JofA’s editorial director.