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Who Benefited from PPP? – Treasury to Disclose Businesses Who Claimed

There have been calls for transparency ever since the Department of Treasury and the Small Business Administration began their work under the Paycheck Protection Program.  Numerous individuals in both the private and public sectors called on the Administration to publicize who was benefiting under the PPP. These calls have grown louder since it was revealed that hundreds of large, publicly traded companies availed themselves of billions of dollars of loans under the program.

After initially resisting, the Treasury announced last week that as early as the beginning of July, data on borrowers receiving loans in excess of $150,000 would be made public.  Included in this information will be business names, addresses, demographic information, NAICS codes, non-profit status, and jobs supported by the loans.  The SBA and Treasury have stated that specific loan amounts will not be disclosed, but businesses will be allocated to brackets based on loans ranging from:

  • $150,000 to $350,000
  • $350,000 to $1 million
  • $1 million to $2 million
  • $2 million to $5 million
  • $5 million to $10 million.

Limited details will be provided for loans below $150,000, and amounts will be aggregated by zip code, industry, business type, and various demographic categories.  While borrowers receiving $150,000 or less under the PPP will not be named in the disclosure, the currently planned release accounts for nearly 75% of loans approved.  Secretary of the Treasury Steven Mnuchin believes the disclosure “…will strike the appropriate balance of providing public transparency, while protecting the payroll and personal income information of small businesses, sole proprietors, and independent contractors.”

In other recent developments, on June 22nd  the Treasury issued new interim final rules to provide guidance on the recently enacted Paycheck Protection Flexibility Act.  Among other things, the Act and rules extend the covered period from 8 weeks to 24 weeks, give businesses greater flexibility in how the loans are spent, and provide safe harbors for businesses that are unable to return to pre-COVID operation levels.

Since its launch, the PPP has garnered a tremendous amount of attention (and scrutiny), and in response the SBA and Treasury have repeatedly revised their guidelines on the Program’s administration and qualification standards.  This constantly evolving landscape has left business owners across the U.S. with a great deal of uncertainty as to the tax consequences of these loans and to what extent the balances will be forgiven. More importantly, the Department of Treasury and SBA have announced that they will do robust reviews of the applications and spending of the borrowers.

Given the high profile and high dollar nature of the Paycheck Protection Program, the Administration will no doubt closely scrutinize taxpayers’ economic situations and motivations for taking out PPP loans as well as determine whether the spending of loan proceeds meets the forgiveness requirements.

To ensure that any inquiries or challenges are quickly resolved in the borrower’s favor it is critical that all steps to document and substantiate economic conditions and outcomes are taken.  If you have any questions, please contact Steven Miller, alliantNational’s National Director of Tax, at (202) 888-7006.

 

GET STARTED

Contact our team today with any tax controversy concern you’re facing. We fight every day to protect the interests of the taxpayer, and we look forward to putting you in the best tax situation possible.

GET STARTED

Contact our team today with any tax controversy concern you’re facing. We fight every day to protect the interests of the taxpayer, and we look forward to putting you in the best tax situation possible.

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Washington D.C.
Willard Office Building, Suite 300 1455 Pennsylvania Ave. Washington, D.C. 20004
202.888.7006

© 2020 alliantNational.- All Rights Reserved.

aNlogo-footer3@2x

Washington D.C.
Willard Office Building, Suite 300 1455 Pennsylvania Ave.
Washington, D.C. 20004
202.888.7006

© 2020 alliantNational. - All Rights Reserved.

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