{"id":25583,"date":"2020-05-06T01:31:19","date_gmt":"2020-05-06T01:31:19","guid":{"rendered":"https:\/\/wcginc.com\/?p=25583"},"modified":"2026-01-26T16:36:47","modified_gmt":"2026-01-26T16:36:47","slug":"sba-ppp-loan-forgiveness","status":"publish","type":"post","link":"https:\/\/wcginc.com\/blog\/sba-ppp-loan-forgiveness\/","title":{"rendered":"SBA PPP Loan Forgiveness"},"content":{"rendered":"<div class=\"wpb-content-wrapper\"><p>[vc_row][vc_column]\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-68b57cc9713c4\" class=\" wd-rs-68b57cc9713c4 wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none border-btm-title \">\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><\/p>\n<div class=\"overview\">\n<h2><span class=\"ez-toc-section\" id=\"Key_Takeaways\"><\/span>Key Takeaways<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li><span style=\"font-weight: 400\">This post focuses on frequently asked questions about PPP loan forgiveness, not on calculating the loan amount.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Maintain consistency with past payroll, bonuses, and pay rates to avoid issues with forgiveness.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Make business decisions based on operational needs, not just to maximize forgiveness or tax deductions.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Full loan forgiveness is challenging; only payroll, rent, utilities, and business loan interest are included.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Paying employees to stay home is not \u201cfree\u201d due to employer tax obligations, even if wages are forgiven.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Payroll periods should ideally align with the eight-week forgiveness window; cash vs. accrual accounting affects calculations.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Eligible forgiveness expenses include gross payroll, health insurance, 401(k) contributions, rent, utilities, and business loan interest.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Home office or personal lease arrangements may complicate forgiveness; SBA guidance is limited.<\/span><\/li>\n<li><span style=\"font-weight: 400\">Loan forgiveness is generally not taxable, but expenses paid with forgiven PPP funds are not deductible.<\/span><\/li>\n<li><span style=\"font-weight: 400\">WCG offers tiered fees for PPP loan forgiveness assistance, based on number of employees; consultation is available for tax-only clients.<\/span><\/li>\n<\/ul>\n<\/div>\n<p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-685df48713b89\" class=\" wd-rs-685df48713b89 wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none border-btm-title img-right \">\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t<h2 class=\"info-box-title title wd-font-weight-800 box-title-style-default font-primary wd-fontsize-m\"><span class=\"ez-toc-section\" id=\"Online_Tax_Accountant\"><\/span>Online Tax Accountant<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><p><img decoding=\"async\" class=\"alignnone size-full wp-image-26096\" src=\"https:\/\/wcginc.com\/wp-content\/uploads\/SBA-PPP-Loan-Forgiveness.jpg\" alt=\"\" width=\"300\" height=\"300\" srcset=\"https:\/\/wcginc.com\/wp-content\/uploads\/SBA-PPP-Loan-Forgiveness.jpg 300w, https:\/\/wcginc.com\/wp-content\/uploads\/SBA-PPP-Loan-Forgiveness-150x150.jpg 150w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/>We have put together a quick list of frequently asked questions involving the SBA\u2019s Paycheck Protection Program and specifically the PPP loan forgiveness component. We have another blog post about the\u00a0<a href=\"https:\/\/wcginc.com\/blog\/paycheck-protection-program\/\">PPP loan calculation<\/a>; this one here is not necessarily about how to calculate the PPP loan forgiveness amount. We will post another one just on the reiterations of that calculus. This post is just about some questions and answers.<\/p>\n<p>Please check back often! We try our best to keep up with the mile a minute changes, and we will also attempt to maintain a revision record at the request of several of our readers, followers and clients. Here are some additional resources\u2013<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\n\t\t\t\t\t<style><\/style>\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t[vc_row_inner equal_height=&#8221;yes&#8221; el_class=&#8221;boxes&#8211;pack&#8221; woodmart_css_id=&#8221;672d69041513d&#8221; responsive_spacing=&#8221;eyJwYXJhbV90eXBlIjoid29vZG1hcnRfcmVzcG9uc2l2ZV9zcGFjaW5nIiwic2VsZWN0b3JfaWQiOiI2NzJkNjkwNDE1MTNkIiwic2hvcnRjb2RlIjoidmNfcm93X2lubmVyIiwiZGF0YSI6eyJ0YWJsZXQiOnt9LCJtb2JpbGUiOnt9fX0=&#8221; mobile_bg_img_hidden=&#8221;no&#8221; tablet_bg_img_hidden=&#8221;no&#8221; woodmart_parallax=&#8221;0&#8243; woodmart_gradient_switch=&#8221;no&#8221; woodmart_box_shadow=&#8221;no&#8221; wd_z_index=&#8221;no&#8221; woodmart_disable_overflow=&#8221;0&#8243; row_reverse_mobile=&#8221;0&#8243; row_reverse_tablet=&#8221;0&#8243;][vc_column_inner width=&#8221;1\/3&#8243;]\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-6899def99f349\" class=\" wd-rs-6899def99f349 wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none srvc-txt-block \">\n\t\t\t\t\t\t\t\t\t\t\t<div class=\"box-icon-wrapper  box-with-icon box-icon-simple\">\n\t\t\t\t\t\t\t<div class=\"info-box-icon\">\n\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img decoding=\"async\" width=\"622\" height=\"622\" src=\"https:\/\/wcginc.com\/wp-content\/uploads\/Mask-group-16-2.png\" class=\"attachment-full size-full\" alt=\"\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t<h3 class=\"info-box-title title wd-font-weight-600 box-title-style-default font-primary wd-fontsize-m\"><span class=\"ez-toc-section\" id=\"PPP_Loan_Forgiveness_App\"><\/span>PPP Loan Forgiveness App<span class=\"ez-toc-section-end\"><\/span><\/h3>\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><p>Learn more about PPP Loan Forgiveness App and how it can help you.<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<a class=\"wd-info-box-link wd-fill\" aria-label=\"Infobox link\" href=\"https:\/\/home.treasury.gov\/system\/files\/136\/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf\" title=\"\" target=\"_blank\"><\/a>\n\t\t\t\t\t\n\t\t\t\t\t<style><\/style>\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t[\/vc_column_inner][vc_column_inner width=&#8221;1\/3&#8243;]\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-685df5d3505eb\" class=\" wd-rs-685df5d3505eb wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none srvc-txt-block \">\n\t\t\t\t\t\t\t\t\t\t\t<div class=\"box-icon-wrapper  box-with-icon box-icon-simple\">\n\t\t\t\t\t\t\t<div class=\"info-box-icon\">\n\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img decoding=\"async\" width=\"622\" height=\"622\" src=\"https:\/\/wcginc.com\/wp-content\/uploads\/Rental-Property-Tax-1-1.jpg\" class=\"attachment-full size-full\" alt=\"\" srcset=\"https:\/\/wcginc.com\/wp-content\/uploads\/Rental-Property-Tax-1-1.jpg 622w, https:\/\/wcginc.com\/wp-content\/uploads\/Rental-Property-Tax-1-1-300x300.jpg 300w, https:\/\/wcginc.com\/wp-content\/uploads\/Rental-Property-Tax-1-1-150x150.jpg 150w\" sizes=\"(max-width: 622px) 100vw, 622px\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t<h3 class=\"info-box-title title wd-font-weight-600 box-title-style-default font-primary wd-fontsize-m\"><span class=\"ez-toc-section\" id=\"PPP_Loan_Forgiveness_Calcs\"><\/span>PPP Loan Forgiveness Calcs<span class=\"ez-toc-section-end\"><\/span><\/h3>\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><p>Learn more how WCG can help you with PPP Loan Forgiveness Calculation.<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<a class=\"wd-info-box-link wd-fill\" aria-label=\"Infobox link\" href=\"\/blog\/ppp-loan-forgiveness-calculation\/\" title=\"\"><\/a>\n\t\t\t\t\t\n\t\t\t\t\t<style><\/style>\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t[\/vc_column_inner][vc_column_inner width=&#8221;1\/3&#8243;]\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-685df6722b885\" class=\" wd-rs-685df6722b885 wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none srvc-txt-block \">\n\t\t\t\t\t\t\t\t\t\t\t<div class=\"box-icon-wrapper  box-with-icon box-icon-simple\">\n\t\t\t\t\t\t\t<div class=\"info-box-icon\">\n\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img decoding=\"async\" width=\"2560\" height=\"1561\" src=\"https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1.jpg\" class=\"attachment-full size-full\" alt=\"\" srcset=\"https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1.jpg 2560w, https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1-300x183.jpg 300w, https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1-1024x624.jpg 1024w, https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1-768x468.jpg 768w, https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1-1536x937.jpg 1536w, https:\/\/wcginc.com\/wp-content\/uploads\/deal-min-scaled-1-2048x1249.jpg 2048w\" sizes=\"(max-width: 2560px) 100vw, 2560px\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t<h3 class=\"info-box-title title wd-font-weight-600 box-title-style-default font-primary wd-fontsize-m\"><span class=\"ez-toc-section\" id=\"SBA_PPP_Guidelines_May_13\"><\/span>SBA PPP Guidelines (May 13)<span class=\"ez-toc-section-end\"><\/span><\/h3>\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><p>Learn more about SBA PPP Guidelines and get started today.<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<a class=\"wd-info-box-link wd-fill\" aria-label=\"Infobox link\" href=\"https:\/\/www.sba.gov\/sites\/default\/files\/2020-05\/Paycheck-Protection-Program-Frequently-Asked-Questions_05%2013%2020.pdf\" title=\"\" target=\"_blank\"><\/a>\n\t\t\t\t\t\n\t\t\t\t\t<style><\/style>\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t[\/vc_column_inner][\/vc_row_inner]\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-685df6859c8ae\" class=\" wd-rs-685df6859c8ae wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none border-btm-title \">\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Should_I_make_changes_to_maximize_the_forgiveness_amount\"><\/span>Should I make changes to maximize the forgiveness amount?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Generally speaking, no. Whatever you did previously to arrive at the PPP loan amount calculation should be maintained in the future. This means do not increase pay rates, pay out bonuses, add friends or family to payroll, or anything else that looks like a material change from 2019\u2026 unless you can justify it.<\/p>\n<p>Conversely, if you have paid out bonuses in May or June in previous years then do the same this year. For example, tax and accounting firms routinely pay out tax season bonuses in May. They also do employee reviews in May which might lead to increased pay rates. Basically, if you have done things in the past then you are typically safe to keep doing them.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Should_I_hire_more_employees_or_change_what_Im_doing\"><\/span>Should I hire more employees or change what I\u2019m doing?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>As with any business decision, you should make operational decisions based on operational necessity. The classic question is Should I buy a car for the business in December for the tax deduction? Truly, the question you should ask is Do I need a car? Making decisions based on a particular tax deduction or making decisions based on PPP loan forgiveness can be very dangerous.<\/p>\n<p>Also, trying to time the system or game the system is counterproductive. Again, make business decisions based on operational necessity.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"How_do_I_ensure_my_entire_loan_is_forgiven\"><\/span>How do I ensure my entire loan is forgiven?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Unless you add employees as compared to last year, it will be very challenging to have 100% loan forgiveness. This is because that 2.5 months or 10.75 weeks of payroll costs was used to determine the PPP loan amount, but you are only given eight weeks to spend it. For example, your loan amount is $100,000. This was based on $40,000 payroll costs per month. Eight weeks might equal roughly $75,000 worth of payroll costs. You will also need $25,000 to be spent on rent, utilities and business loan interest during those same eight weeks to have 100% loan forgiveness.<\/p>\n<p>There will be unicorn cases\u2026 but rare! So please warm up to that concept now before to stay off meltdowns or comeaparts.<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\n\t\t\t\t\t<style><\/style>\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-685df76c498f5\" class=\" wd-rs-685df76c498f5 wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none border-btm-title \">\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><p><img decoding=\"async\" class=\"alignnone size-medium wp-image-23697\" src=\"https:\/\/wcginc.com\/wp-content\/uploads\/rave-300x183.jpg\" alt=\"\" width=\"300\" height=\"183\" srcset=\"https:\/\/wcginc.com\/wp-content\/uploads\/rave-300x183.jpg 300w, https:\/\/wcginc.com\/wp-content\/uploads\/rave.jpg 328w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Should_I_pay_my_staff_to_sit_at_home\"><\/span>Should I pay my staff to sit at home?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p class=\"Text\">Please understand that paying employees is not necessarily free. Yes, the gross wages might be forgiven as a part of the PPP loan forgiveness calculation, but the company still has expenses associated with payroll such as the employer portion of Social Security and Medicare taxes that are not part of payroll costs from a forgiveness calculation perspective. Having said that, it still might make sense to pay people because they are a key person and remain critical to your continued operations in the future.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"How_does_quarterly_or_monthly_payroll_fit_into_an_eight-week_window\"><\/span>How does quarterly or monthly payroll fit into an eight-week window?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>One of the biggest unknowns with the PPP loan forgiveness calculation is the concept of cash versus accrual accounting. In cash accounting, revenue and expenses are recognized on the date that they were received or paid. Cash in, cash out\u2026 simple! In accrual accounting, revenue and expenses are recognized on the date that they were earned and when the obligation was incurred. As of today, we are unclear on which method of accounting the SBA will require. The purest way is to use accrual accounting. The simplest way, a way that might actually reduce the amount of PPP loan forgiveness, is cash accounting.<\/p>\n<p>As such, we recommend taking the mystery out of this and converting yourself to have four convenient payroll events within the eight-week forgiveness period. This would suggest biweekly payroll with each payroll period being two weeks. There might be some minor adjustments or tweaks for the first payroll period and the last.<\/p>\n<p>Also, it is easy to confuse payroll periods and pay dates. Ideally the payroll periods should fit neatly into the eight-week but that might not be practical if you already are processing payroll on a cadence not aligned with your eight-week period. Payroll periods and pay dates goes back to one of the pillars of confusion which is cash versus accrual accounting.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"What_expenses_are_included_in_the_PPP_loan_forgiveness_calculation\"><\/span>What expenses are included in the PPP loan forgiveness calculation?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The four basic expenses are payroll costs, rent, utilities and business loan interest. Let\u2019s break each of these down even further.<\/p>\n<p>Payroll costs include gross pay, company paid health insurance premiums including dental and vision, and company paid 401(k) contributions. There are some other minor devils in the details but these cover most of it.<\/p>\n<p>Rent includes what you would generally think of such as a lease agreement for your office space, but it also includes lease agreements for your company car and perhaps office equipment such as a copier. Other things might be considered a lease such as software leases, however those remain unclear at this time.<\/p>\n<p>The CARES Act specifically defines utilities as \u201ca service for the distribution of electricity, gas, water, transportation, telephone, or internet access.\u201d A couple of things that might also be included but not specifically listed are trash removal and security systems. Another question is HOA dues or NNN leases where a portion of the payment includes utilities. For example, a lot of commercial lease agreements include electricity but they also back charge the tenant based on square footage.<\/p>\n<p>Business loan interest includes any loan that is secured by real or personal property. One of the immediate questions is lines of credit which are generally not secured by property. Another consideration is what accountants refer to as capitalized leases. These are lease agreements that are generally disguised financing transactions. A great example is an office copier that is leased for three years, and at the end of the lease you purchase the copier for a dollar. This truly is financing and it has an interest component that would be considered a part of the PPP forgiveness calculation.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"I_dont_have_a_rental_lease_agreement_since_I_use_a_home_office_How_does_this_work\"><\/span>I don\u2019t have a rental lease agreement since I use a home office. How does this work?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>This also remains unclear. There is very little guidance from the SBA or the Treasury regarding the PPP forgiveness calculation. This is understandable because they have been focused on PPP loan calculations and eligibility, and not so much on the second phase of PPP loan forgiveness.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Is_the_PPP_loan_forgiveness_calculation_complicated\"><\/span>Is the PPP loan forgiveness calculation complicated?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>It can be very complicated. The very first question is eight weeks versus two months. These are synonymous in some circles and definitely different in others. A lease agreement, for example, is done on a monthly basis as opposed to a weekly basis. However, the IRS in some parts of the tax code defines a month as a four-week period. However, the IRS tax code is not in charge necessarily. The CARES Act makes several references to various tax code sections, but it also creates a lot of its own definitions as well.<\/p>\n<p>The next complication is any kind of \u201csaddled\u201d expenses. For example, you pay rent in advance. Let\u2019s say you paid April\u2019s rent on April 1 and were then funded for your PPP loan on April 15. Shouldn\u2019t a portion of that April payment then be considered a part of the PPP forgiveness calculation? Perhaps, and it again depends on cash versus accrual accounting.<\/p>\n<p>The next complication is all the PPP loan forgiveness reductions. This includes no more than 25% being spent on non-payroll costs such as rent, utilities and business loan interest. It also includes the full-time equivalent calculations and pay reduction calculations. For a one-person S Corp, this might be fairly straightforward. For anyone with employees, this gets really complicated really fast.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"What_happens_if_I_dont_spend_all_the_loan_proceeds\"><\/span>What happens if I don\u2019t spend all the loan proceeds?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The SBA has a beautiful prison in Colorado, and you\u2019ll get a cell next to El Chapo. He is the PPP forgiveness liaison to the SBA and will assist in your rehab. All kidding aside, the unspent amount after the eight-week period becomes your \u201cremainder\u201d loan. This would also include any amount spent on payroll, rent, utilities and business loan interest that was considered not forgiven.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"The_forgiven_amount_of_my_loan_taxable\"><\/span>The forgiven amount of my loan taxable?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>No. But there is a slight situation that the IRS reminded everybody about in\u00a0<a href=\"https:\/\/www.irs.gov\/pub\/irs-drop\/n-20-32.pdf\" target=\"_blank\" rel=\"noopener\">Notice 2020-32<\/a>. The IRS states that expenses paid with non-taxable income, such as PPP loan forgiveness monies, are not tax deductible. This would be a double dip, and traditionally requires an allocation to be performed on the business entity tax return. The AICPA is currently fighting this however there is significant history with the IRS not allowing tax deductions when the \u201cincome\u201d used to pay for those expenses is not taxable. In other words, you will not have an increase in revenue based on loan proceeds but you will also have a decrease in normal operating expenses.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"What_are_WCGs_fees_for_helping_with_the_PPP_loan_forgiveness_calculation\"><\/span>What are WCG\u2019s fees for helping with the PPP loan forgiveness calculation?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Our fees are generally based on complexity. We have attempted to simplify the structure based on the number of employees which also includes the number of shareholders. Here are our fixed rates-<\/p>\n<table>\n<tbody>\n<tr>\n<td>1-2 employees<\/td>\n<td>$450<\/td>\n<\/tr>\n<tr>\n<td>3-5 employees<\/td>\n<td>$900<\/td>\n<\/tr>\n<tr>\n<td>6-10 employees<\/td>\n<td>$1,500<\/td>\n<\/tr>\n<tr>\n<td>11-15 employees<\/td>\n<td>$2,000<\/td>\n<\/tr>\n<tr>\n<td>16-20 employees<\/td>\n<td>$2,500<\/td>\n<\/tr>\n<tr>\n<td>21+ employees<\/td>\n<td>Custom Quote<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>If you are one of our business advisory service clients, the PPP loan calculation and the PPP loan forgiveness calculation is considered outside of scope. However, as part of our consultation arrangement we will provide questions to your answers should you want to put together your own calculation paperwork.<\/p>\n<p>For those clients who have a tax-only engagement with us, our hourly rate is $250 per hour for PPP consultation.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Engagement\"><\/span>Engagement<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>We have a separate engagement agreement for the PPP forgiveness component. Please visit the button below. If you have questions or concerns, please contact us at 719-387-9800 or\u00a0ppp@wcginc.com.<\/p>\n<p>Warm Regards,<\/p>\n<p>Your PPP Task Force<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\n\t\t\t\t\t<style><\/style>\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<div class=\"info-box-wrapper\">\n\t\t\t\t<div id=\"wd-68b57d13b89cb\" class=\" wd-rs-68b57d13b89cb wd-info-box wd-wpb text-left box-icon-align-top box-style- color-scheme- wd-bg-none border-btm-title faqs-wrap \">\n\t\t\t\t\t\t\t\t\t\t<div class=\"info-box-content\">\n\t\t\t\t\t\t<h2 class=\"info-box-title title box-title-style-default wd-fontsize-m\"><span class=\"ez-toc-section\" id=\"Frequently_Asked_Questions\"><\/span>Frequently Asked Questions<span class=\"ez-toc-section-end\"><\/span><\/h2>\t\t\t\t\t\t<div class=\"info-box-inner reset-last-child\"><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Does_this_post_calculate_PPP_loan_forgiveness\"><\/span>Does this post calculate PPP loan forgiveness?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>No, it addresses common questions and guidance for forgiveness.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Should_I_increase_pay_or_hire_more_staff_to_maximize_forgiveness\"><\/span>Should I increase pay or hire more staff to maximize forgiveness?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Only if operationally necessary; avoid changes solely for forgiveness purposes.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"What_expenses_count_toward_PPP_loan_forgiveness\"><\/span>What expenses count toward PPP loan forgiveness?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Payroll, rent, utilities, and business loan interest.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Is_paying_employees_to_stay_home_fully_covered\"><\/span>Is paying employees to stay home fully covered?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>No, employer taxes and other costs are still incurred.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"How_should_payroll_periods_align_with_the_forgiveness_window\"><\/span>How should payroll periods align with the forgiveness window?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Ideally, use biweekly payroll that fits neatly into the eight-week period.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Are_forgiven_PPP_funds_taxable\"><\/span>Are forgiven PPP funds taxable?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>No, but expenses paid with forgiven funds are not deductible.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"What_if_I_dont_spend_all_the_loan_proceeds\"><\/span>What if I don\u2019t spend all the loan proceeds?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Unspent amounts remain a loan balance and are not forgiven.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Does_a_home_office_qualify_for_rent_forgiveness\"><\/span>Does a home office qualify for rent forgiveness?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Guidance is unclear; SBA has not provided definitive rules.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"How_does_WCG_charge_for_PPP_forgiveness_help\"><\/span>How does WCG charge for PPP forgiveness help?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Fixed fees based on employee count or hourly rates for tax-only clients.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Can_I_make_operational_changes_to_improve_forgiveness\"><\/span>Can I make operational changes to improve forgiveness?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Only if changes are justified by business needs, not for tax strategy alone.<\/p>\n<\/div>\n\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t[\/vc_column][\/vc_row]<\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"<p>[vc_row][vc_column][vc_row_inner equal_height=&#8221;yes&#8221; el_class=&#8221;boxes&#8211;pack&#8221; woodmart_css_id=&#8221;672d69041513d&#8221; responsive_spacing=&#8221;eyJwYXJhbV90eXBlIjoid29vZG1hcnRfcmVzcG9uc2l2ZV9zcGFjaW5nIiwic2VsZWN0b3JfaWQiOiI2NzJkNjkwNDE1MTNkIiwic2hvcnRjb2RlIjoidmNfcm93X2lubmVyIiwiZGF0YSI6eyJ0YWJsZXQiOnt9LCJtb2JpbGUiOnt9fX0=&#8221; mobile_bg_img_hidden=&#8221;no&#8221; tablet_bg_img_hidden=&#8221;no&#8221; woodmart_parallax=&#8221;0&#8243; woodmart_gradient_switch=&#8221;no&#8221; woodmart_box_shadow=&#8221;no&#8221; wd_z_index=&#8221;no&#8221; woodmart_disable_overflow=&#8221;0&#8243; row_reverse_mobile=&#8221;0&#8243; row_reverse_tablet=&#8221;0&#8243;][vc_column_inner width=&#8221;1\/3&#8243;][\/vc_column_inner][vc_column_inner width=&#8221;1\/3&#8243;][\/vc_column_inner][vc_column_inner width=&#8221;1\/3&#8243;][\/vc_column_inner][\/vc_row_inner][\/vc_column][\/vc_row]<\/p>\n","protected":false},"author":6,"featured_media":62735,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[17],"tags":[],"class_list":["post-25583","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.8 (Yoast SEO v27.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>SBA PPP Loan Forgiveness - WCG CPAs &amp; 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