SEC Says PPP Loans MAY Require Disclosure to Clients
The directive from SEC staff explains that “If the circumstances leading [an advisory firm] to seek a PPP loan…constitute material facts relating to your advisory relationship with clients,” then they should be disclosed. The SEC provided two examples of such material facts:
This guidance from the SEC appears inconsistent with guidance issued by FINRA several weeks ago, when it announced that PPP loans did not need to be reported as a ‘compromise with a creditor’ in response to Question 14K on Form U4.
AALU/GAMA continues analyze this guidance and will keep members updated. Stay tuned to the COVID-19 action center and our emails for future updates.
Updated PPP Guidance – Expense Deductibility After PPP Loan Forgiveness
On Thursday night, the IRS issued clarifying guidance around the ability for small businesses to claim deductions for the wages and expenses paid using a PPP loan if that loan subsequently was forgiven.
Citing section 265 of the tax code, the IRS contends that businesses who met the qualifications and whose loans were forgiven and therefore not included in their gross income for tax purposes (a key feature of the loan program) could not also deduct those same expenses from their taxes, as is customary. As the statue is written, the IRS believes that would lead to a double tax benefit and therefore is impermissible.
Both Chairman of the Senate Finance and House Ways and Means Committees have indicated they may possible seek a legislative adjustment to make the expenses deductible, leaving open the possibility of future legislation.
To Read More – WSJ Report
To address the economic challenges created by the COVID-19 pandemic, many employers must balance the desire to aid their employees with the need to conserve cash and ensure the continuity of the business. This WR Marketplace walks through the actions that can be taken under the new law and costs and benefits of various options to assist employees.
This FAQ dives into detail on the Paycheck Protection Program and how to calculate your loan amount.
AALU/GAMA’s Emily Tavino provides an update on the latest polling, looking at the effects of COVID-19 on the presidential race.
AALU/GAMA’s James Bailey discusses how advocacy has changed with social distancing, what organizations are doing to say connected, and how you can reach your lawmakers.
ICYMI: Recent Webinars
Hear Agency One’s Gonzalo Garcia, Clareto’s Dave Dorans, Principal Financial Group’s Neal Halder, and Swiss Re’s Nichole Myers discuss the changes in underwriting.
Capital Strategies Group, Inc.’s David Byers and BakerHostetler’s Jonathan Forster share transferable business ideas on how they are helping their clients navigate planning and market volatility.
Congressman Ron Estes (R-KS) joins AALU/GAMA’s Marc Cadin for a behind-the-scenes look at the CARES Act, what comes next, and the importance of advocacy.
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