PPP Loans Forgiveness Tax Guidance

The U.S. Treasury Department and the IRS issued guidance on Nov.18 further clarifying that:

• Expenses paid with forgiven Paycheck Protection Program loans will not be deductible; and
• Borrowers whose PPP forgiveness is at least partially denied, or who opt to forgo forgiveness, may deduct such expenses in the tax year they decide to forgo the forgiveness. Read more.

Read Treasury Secretary Mnuchin's related statement. 

Wisconsin State Taxes and PPP Loan Forgiveness 

On April 15, 2020, the Wisconsin legislature passed, and Governor Evers signed, Assembly Bill 1038, which conforms to certain provisions of the CARES Act, including the tax treatment of PPP loans.  Forgiven PPP loans are not includable in taxable income.