PPP & The Governor: The California governor must be very confident that he will not be recalled because with the signing of AB 80, he stated that only companies that showed a decline of 25% of revenue for any one quarter can qualify to deduct expenses paid for by PPP money, calling it a $6.2B tax cut. It is nothing of the sort; in fact, it is a tax increase because the PPP funds are not revenue, so to not allow expenses to be deducted, you have increased their taxes. That aside, here is the criteria: If you experienced a 25% reduction in revenues in any one quarter from 2019 to 2020, you can deduct the expenses paid for by the PPP loan. If you cannot prove that, the expenses are not tax deductible. Don’t forget to vote.
Finally… as of April 25, $248B in loans have funded for 2021. That leaves about $34B for the next four weeks before the program expires. MANY SOLE PROPRIETORS STILL DO NOT KNOW ABOUT THIS PROGRAM – ENLIGHTEN THEM!!