Tax Policy - The S Corporation Association

More Business Community Support for COVID-19 Reforms

The Main Street Employers coalition today endorsed legislation scheduled to voted on in the House of Representatives tomorrow. The bill, the Paycheck Protection Program Flexibility Act, was introduced by Representatives Dean Phillips (D-MN) and Chip Roy (R-TX) and would help restore confidence and energy to a program badly in need of both – the Paycheck Protection Program. As the letter states:

Congress launched the Paycheck Protection Program (PPP) to help employers keep their workers on payroll and, once it was safe to do so, enable them to quickly return to work. The PPP is arguably the most successful …

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admin2020-05-27T19:43:00+00:00May 27, 2020|

HEROES Act Kicks Businesses When They Are Down

House leadership released their HEROES Act yesterday with a plan to vote on it Friday. The bill includes an eye-popping $3 trillion in assistance to families, businesses, non-profits, and governments.

One item that stands alone in this tidal wave of spending is the repeal of the NOL and loss limitation relief enacted as part of the CARES Act. Where almost all the other HEROES Act provisions reduce costs on businesses, this one would hike their taxes.

Let’s be clear — the CARES Act NOL provisions are largely timing benefits – whatever tax benefit businesses receive now will have to be repaid …

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admin2020-05-13T21:25:04+00:00May 13, 2020|

More on NOL and Loss Limitation Relief

Allowing businesses to use losses to offset income earned in prior years is a longstanding anti-recession policy with solid bipartisan support. It was adopted after the 9/11 terrorist attacks, after Hurricane Katrina, and again following the financial crisis. It is simply a way to give businesses suffering losses the ability to recognize those losses more quickly.

Yet now some are charging that the bipartisan loss limitation relief included in the CAREs Act is a “massive” tax break for “hedge funds” and real estate moguls that was “snuck” into the bill at the last moment. None of this is true.

In fact, …

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admin2020-04-29T16:27:19+00:00April 24, 2020|

Main Street Support for Paycheck Protection Loans

More than 200 national and state-based trade groups wrote to congressional leadership today calling on Congress to increase funding for Paycheck Protection Program (PPP) loans.

That program was authorized by the CAREs Act last month and, among many other programs, provided individually and family-owned businesses with $350 billion in loans to help those businesses retain their employees during the COVID-19 crisis.

According to the latest figures from the Small Business Administration, however, applications to date number over million and nearly$300 billion of the initial authorization. The expectation is that the program will run out of authorization by the end of the …

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admin2020-04-15T18:00:37+00:00April 15, 2020|

Washington Post Supports “Recession Bombs”

Is the loss limitation relief in the CAREs Act an unwarranted giveaway, as claimed by the Washington Post this week? That’s a big “N-O.” As others have noted, this relief prevents the “recession bombs” of the underlying NOL and loss limitation rules from inflicting damage on Main Street during the COVID-19 crisis.

Here’s the reality and why 120 Main Street business groups asked Congress to adopt this provision earlier this year:

The benefit is timing only: Aside from some limited rate arbitrage, any tax reductions allowed by the loss limitation relief this year would have otherwise been claimed in …

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admin2020-04-14T22:21:01+00:00April 14, 2020|