Many taxpayers have been affected by the COVID-19 pandemic. In the business sector, many small business taxpayers were forced to seek loans under the Paycheck Protection Program (“PPP”) in an effort to navigate the crisis’ effect on their businesses and employees. Moreover, taxpayers can literally trip over the amount of guidance, legislation, and information circulating (and changing) in the ether with respect to the use and forgiveness of their PPP loans. The largely unanswered question has been this—how will the various tax agencies treat PPP loans that are forgiven and/or the expenses paid or incurred as a result of the PPP loans? While taxpayers may have more clarity from the federal government, it is still unclear how Texas will answer that question.
PPP Tax Consequences at the Federal Level
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