Congress passed a massive $900 billion bill focused on providing support to individuals and small business owners. The legislation (which was passed overwhelmingly in both chambers of Congress) includes more than $300 billion in financial assistance for small business owners. Here is an overview of the key provisions within the legislation that are likely to impact business owners in and around Los Angeles.
Tax Deductibility of Business Expenses Paid Through PPP Loans
The legislation ensures that business owners can still take tax deductions for business expenses paid with forgiven Paycheck Protection Program (PPP) loans.
New Round of PPP Loans and Larger Applicant Pool
In addition to addressing the issue of tax deductibility for certain business expenses, the legislation directives the Small Business Administration to offer a new round of PPP loans and broadens the applicant pool by enabling 501(c)(6) not-for-profit organizations eligible to apply for PPP loans. Certain businesses who already received a PPP loan will also be afforded the chance to apply for a second PPP loan.
Funding Infusion for the EIDL Program
Along with directing new funds for PPP loans, the legislation allocates $20 billion to the Economic Injury Disaster Loan (EIDL) program. This is critically important since EIDL grants are generally made available to businesses based in low-income communities.
Financial Support for the Retail and Entertainment Sectors
The legislation creates a dedicated fund infused with $15 billion to support the owners of independent movie theaters cultural institutions and live entertainment venues.
Extension of Unemployment Programs
The legislation extends the Pandemic Unemployment Assistance (PUA) program and broadens coverage under the PUA so it can be accessed by individuals who are self-employed, gig workers, and other individuals who are working in non-traditional fields.Furthermore, the legislation extends the Pandemic Emergency Unemployment Compensation (PEUC) program, which provides unemployment benefits at the federal level when someone has exhausted unemployment benefits at the state level.
Extension of Various Tax Provisions
The legislation extends an employee retention tax credit and various expiring tax provisions that apply to small business owners. In addition, the bill provides a 100 percent business expense deduction for meals (under current law, you can only deduct up to 50 percent of business-related meals).
Have Questions About the Impact of the New COVID-19 Legislation on Your Business? Speak to a Reputable Business Lawyer in Los Angeles Today
If you have questions about how the new COVID-19 relief legislation could impact your business, contact the highly reputable and experienced business lawyers in Los Angeles at Hakim law Group. Our law firm represents an array of entrepreneurs, operating companies, venture capital firms, and financiers in various sectors of the economy. Our extensive experience enables our firm to handle a broad range of legal matters in the business world, including business formation, technology transactions, lending, employment and so forth. For further information or to schedule a consultation please contact HLG at 310.993.2203 or visit www.HakimLawGroup.com to learn more.