James Moore partner and Healthcare Services Team member Erin Spiwak recently sat down to discuss the most recent developments that affect your practice. Here’s a breakdown of what she covered.
Provider Relief Funds
If you’ve received (or will receive) over $10,000 in any round of Provider Relief Fund (PRF) payments, you face important reporting requirements. Specifically, you’ll have to attest they were spent on the correct expenses and/or replaced lost revenue.
The portal to report PRF funds is slated to open on Jan. 15, 2021. Reporting is due by Feb. 15, 2021, giving you a month to submit this information. If you haven’t spent all the funds, you have extra time in 2021 to do so. (Read here to learn more about PRF Phase 3 funding.)
Paycheck Protection Program
There are a few significant developments regarding PPP loans. First, thanks to the recently passed law, all PPP money used for eligible expenses will be deductible on your return in the year the expenditures were paid or incurred. This is a reversal of an IRS ruling that was meant to prevent “double dipping” on tax benefits and a big win for taxpayers.
Additionally, the second round of PPP (known informally as PPP2), is now available. Even if you received a first round PPP loan, you could still be eligible for this round. You must show you have fewer than 300 employees and a 25% reduction of revenue in any 2020 calendar quarter over the same quarter in 2019. Your loan maximum can be two and a half times your monthly payroll using either 2019 or 2020 payroll figures. There are also specific rules for borrowers under NAICS code 72 and farmers/ranchers.
Finally, the definition of non-payroll expenses for PPP purposes has been expanded. The same 60% payroll/40% non-payroll cost rules applies. Now, however, the non-payroll costs include specific COVID-related expenses, property damage expenses and operational supplies
Erin and the entire team at James Moore are firmly committed to sharing their knowledge with you on these and other topics. We encourage you to sign up for our email newsletters to receive the most updated information as it develops. As always, our healthcare CPAs are ready to help and look forward to hearing from you!
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