Today, United States Senator Marco Rubio (R-FL) held a town hall on the Paycheck Protection Program (PPP) loan forgiveness process. The town hall was held with the Florida Institute of Certified Public Accounts’ (FICPA) leadership and board. During the town hall, the Senator discussed specific federal responses to the ongoing COVID-19 pandemic. The topic included details of the Paycheck Protection Program (PPP) loan forgiveness process. On the call was THF shareholder, Julian Dozier, a current member of the FICPA board.
Senator Rubio spoke extensively about the issue of tax deductibility for those expenses used to qualify for PPP loan forgiveness. This includes a recently introduced bill in the U.S. Senate, SB 3612, that would reverse recent Treasury guidance on this topic. This bill would also address the fact that tax collection projections prepared as the CARES Act was drafted did not contemplate the non-deductibility of related expenses.
Other topics included:
- The current and near-term absence of a vaccine or effective therapeutic treatments for the virus or disease
- How the federal government is attempting to “mitigate some of the pain” through this economic hardship
- Future stimulus opportunities
- The creativity of restaurants and their outlook as social distancing continues in a modified form
- The payroll stabilization model used throughout much of Europe as compared to the PPP approach used in the U.S. (i.e., via SBA 7a loans)
- The current Treasury rule requiring PPP recipients to spend 75% of loan proceeds on payroll over an immediate 8 week period and possible changes to that rule
- PPP loan forgiveness and tax deductibility of expenses
- Federal efforts to allocate funds for medical research and treatment
- How, under the PPP, the SBA funded 14 years’ worth of loans in only 7 days (!)
- Potentially auto-certifying low-risk PPP loans for forgiveness
- How to calculate FTEs under the PPP
Senator Rubio was attentive to the concerns that CPAs and their clients are facing. He is also concerned for the effect that this ongoing pandemic is having on our state and national economy.
Look for further guidance from your team at THF CPAs as guidance is released and/or as further stimulus bills are passed. Continue to check the THF COVID-19 Resources Center often for more updates.