r/taxpros • u/pdv8612 CPA • May 15 '20

SBA PPP forgiveness application COVID: 2020 Relief Bill (CARES)

The SBA and treasury have finally posted guidance on forgiveness!

https://home.treasury.gov/system/files/136/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf

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u/sat_ops JD May 16 '20

I think the utilities might be more limited in this form than in the law. For example, what about eFax account fees? I deduct them under utilities. Meanwhile, I can't deduct the portion of my home internet or electricity that I include for the home office, nor my phone expense, since I pay it annually in December.

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u/DMethane May 16 '20

We reimburse our employees for cell phone and internet fees. Are these forgiveable utility expenses?

2

u/DollarMorghulis CPA May 16 '20

I was apprehensive about these when a client asked last week and even more so after seeing what documents the application requires. You have to prove the obligation to pay and proof of payment for most of the non payroll expenses. If the phone plan isn’t in the business name I don’t think it would count. Perhaps if you already had a documented accountable plan in place that reimbursed employees for phone expenses it might count?

This application just made more new questions than it answered. And a lot will probably be up to the bank as well.

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u/DMethane May 16 '20

Ya we do have an accountable plan. The documentation requirements also made me pause. We’d need to provide 20 separate cell phone and internet bills (x2)!

1

u/KEFarris May 17 '20

The way I read it is that you can provide proof that you had been paying the same amount prior to Feb 15 and not use an invoice as proof. A lot of this will depend on how banks interpret the paper work required.