How Will COVID-19 Affect My 2020 Tax Return?

By: Elisabeth - June 30, 2020 - 8:16 am

Federal and state governments have taken action to help Americans financially with the COVID-19 pandemic. How will this affect your taxes?

Payroll Protection Program (PPP) Loan Forgiven Expenses are NOT deductible

  • The IRS has issued guidance that expenses paid with PPP funds are not a deduction on your 2020 tax return.
  • Specifically, an expense (rent, utilities, or payroll) is not deductible if 1. The payment results in PPP forgiveness and w. the income associated with the forgiveness is excluded under the CARES Act.

PPP Loan Update

  • Covered period extended from 8 to 24 weeks
  • Employer Social Security payments may be deferred
  • Loan payment deferral extended from 6 to 10 months
  • Payroll threshold adjusted from 75% to 60%
  • Safe harbor date extended from 6/30/2020 to 12/31/2020
  • Loan term date extended

COVID-19 Tax Question FAQs

  • Can I deduct expenses from having to work from home?
  • Are unemployment benefits taxable?
  • If I sell a losing stock now, can I deduct the loss on my 2020 tax return?
  • Is the deadline to contribute to my IRA extended?
  • When are 2020 tax estimates due?

Please continue to refer to our Blog for up-to-date information on COVID-19.

Check out the weekly Tax Flash posted to our website (www.bsgwealth.com) and Facebook page every Tuesday.

We will continue to provide updates via email and our website regarding office hours and meetings.