Pennsylvania has approved legislation clarifying tax rules on PPP loans and also providing $912 million in COVID relief aid.
The legislation, approved Friday, clarifies that Paycheck Protection Program loans that are forgiven are not taxable in Pennsylvania and that businesses may deduct eligible expenses paid with PPP loan proceeds. This aligns Pennsylvania’s PPP rules with federal rules approved in December and is very beneficial to businesses and individuals with PPP loans.
The COVID relief aid includes $145 million for the hard-hit hospitality industry. The money would be available through counties in grants of up to $50,000 for bars, restaurants and hotels with under 300 employees.
Most of the relief aid – $570 million – will be sent to counties based on population to help people struggling to pay rent or utilities. Both landlords and tenants would be eligible to apply.
The remaining $197 million will go to private schools and other educational institutions that did not receive funding from the federal coronavirus aid for public schools and charter schools.
Have questions about PPP taxability or deductions? Please contact us for personalized assistance.
