December 30, 2020

ACR-Backed PPP Loan Tax Changes Can Help Radiology Practices

American College of Radiology®-backed changes to tax treatment of Paycheck Protection Program (PPP) loans in the Consolidated Appropriations Act, 2021 (Omnibus and Coronavirus Relief Bill) can financially strengthen your practice. But you must act quickly!

Please speak to your practice’s chief financial officer and/or accountants by 11:59pm December 31 to see if your practice qualifies for these deductions included in Section 276 of this summary of the 5,000-page bill, recently signed into law by President Trump.

The new PPP tax provisions clarify that:

  • Gross income will not include any amount that would be attributed to the forgiveness of a PPP loan.
  • Deductions are allowed for otherwise deductible expenses paid with the proceeds of a PPP loan that is forgiven.
  • The tax basis and other attributes of the borrower’s assets will not be reduced as a result of the loan forgiveness.

The tax provisions are effective as of the date of enactment of the CARES Act. The provisions allow for similar treatment for Second Draw PPP loans, effective for tax years ending after the date of enactment of the provisions. 

Please see Section 276 of this summary of the new legislation for more specifics.