Action Alert: Do You Have A PPP Loan? Do you want it taxed?
The House Ways and Means and Senate Finance Committees have amended the latest State COVID relief bill to include a provision placing an income tax on Payment Protection Program (PPP) loans that were forgiven by the federal government in tax year 2021. In short, if your PPP loan was forgiven in 2021, or has yet to be forgiven, you will be taxed on the amount of your loan as if it was business income.
If you have a PPP loan, and do not want to be taxed on that loan in tax year 2021, we strongly suggest you reach out to your legislator to urge them to maintain tax forgiveness for these relief funds.
In order to keep their doors open, many practices accepted federal PPP loans and closely followed the conditions to qualify them for 100% forgiveness from repayment and from tax implications. Now the legislature has decided to treat these relief funds as taxable income. Please tell the Vermont legislative tax committees not to subject the federal PPP loans to State income tax!
Click here to learn more and to read the Lake Champlain Chamber letter the Vermont Medical Society signed onto urging tax forgiveness for PPP loans for every business sector that has struggled to survive throughout the pandemic:
"I feel strongly that the Legislature should reverse its decision to insert, at the last minute, a new and punitive tax liability on federal PPP loans. These forgivable loans were issued to help employers survive this pandemic and preserve jobs. And our businesses have applied for these loans with the understanding they would not be taxed. In addition, Senator Leahy's office has confirmed that these resources were never intended to be taxed. The Legislature should be at their side, helping them up. Not on their back, trying to raise yet more in taxes." - Governor Phil Scott
Click here to read the VTDigger article:
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