It’s a fact that taxpayers know well.
Uncle Sam’s tax rules are not always clear. (A huge understatement!)
But thanks to new government guidance, the rules governing PPP loan-forgiveness, for several types of business entities, are models of clarity. (More or less.)
To be specific… the new PPP rules explain clearly how you can identify your personal (owner-employee) qualifying compensation no matter what kind of business structure you’re using. And that’s just for starters.
To find out more about how the newly clarified government rules affect you, don’t miss our new article titled Tax Tips: PPP Loan Forgiveness for Partnerships and S and C Corporations.
Here are just some of the important subjects we’ll cover
when you read the full article:
- The owner-employee category. There are four types of owner-employee categories you need to know about.
- Owners of multiple businesses. Careful! You need to consider the owner-employee loan maximums that apply.
- Partnerships. PPP loan-forgiveness for general partners depends on the amount of their 2019 net earnings from self-employment (reduced in several ways).
- S corporations. As with all owner-employees, the PPP loan and its forgiveness for “compensation,” are capped at $15,835 under the eight-week covered period and $20,833 under the 24-week covered period.
- C corporations. C corporation owner-employees are capped by the amount of their 2019 employee cash compensation, plus employer retirement and health insurance contributions made on their behalf.
- Schedule C taxpayers. To learn how forgiveness works for Form 1040 Schedule C taxpayers, see Government Clarifies PPP Loan Forgiveness for the Self-Employed.
- When can an owner-employee’s business apply for forgiveness? According to the recently issued SBA guidance, you can submit your loan forgiveness application any time on or before the maturity date of the loan. We’ve also included more information on the forgiveness process.
You’ll get full details when you read the full article
PPP Loan Forgiveness for Partnerships and S and C Corporations.