Publications

IRS Issues Notice on Deductibility of Expenses Paid with Forgiven PPP Money

May 2, 2020

On April 30, 2020, the Internal Revenue Service (IRS) issued Notice 2020-32, which provides that no deduction is allowed for expenses paid with loan money forgiven under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).

Notice 2020-32 explains that, because forgiven loans are not treated as income under the CARES Act, the denial of a tax deduction for expenses paid with forgiven loan proceeds prevents a double tax benefit, as consistent with Section 265 of the Internal Revenue Code.

Attorneys at Tarter Krinsky and Drogin have analyzed the latest notices issued by the IRS that relate to the COVID-19 pandemic, including Notice 2020-32 highlighted above. Please contact your relationship attorney or CV19team@tarterkrinsky.com if you have any inquiries on how this may affect your business.

  • share with
Name Title Direct Dial Vcard
Chu, Justin Y.K. General Counsel and Partner General Counsel and Partner 212.216.1160 VCard
Lydell, Sherri D. Partner Partner 212.216.1151 VCard
Malinowski, Simon I. Associate Associate 212.216.1133 VCard
Molinari, Guy Partner and Chair of Corporate and Securities Group Partner and Chair of Corporate and Securities Group 212.216.1188 VCard
Rudolph, Elishama A. Associate Associate 212.216.1145 VCard
Smith, James G. Partner Partner 212.216.8060 VCard

Privacy Policy

We have updated our privacy policy. Click here to view.

I agree