The recently signed Coronavirus aid package includes important benefits for American farmers. Chad Smith has more on important changes to the Paycheck Protection Program.
Smith: The Paycheck Protection Program was designed by Congress to help small businesses stay open and keep their employees on the payroll. Pat Wolff, senior director of congressional relations with the American Farm Bureau, talks about how the important program worked to keep businesses running during COVID-19.
Wolff: The way that it did that was to provide loans, and then forgive repayment if the loans were used for three things: wages, mortgages/rent, and utilities.
Smith: Wolff says when Congress passed the PPP, they were very clear that loan amount would not be taxable. She says the Treasury Department took an unfortunately different position.
Wolff: They were going to deny tax deductions for expenses paid with those loans, and so, in effect, they were canceling out Congress’s intent to provide those loans tax-free. And that is one thing that got fixed in the bill that passed last week and was signed into law by the president.
Smith: Wolff says the COVID-19 relief bill also had another important item that will benefit American farmers.
Wolff: The COVID relief bill did one other thing that will be helpful to farmers, and that is it expanded the things that PPP loans can be used for. The bill added personal protective devices, so now, when a farm employer has to buy special gear or make accommodations for his workers to stay safe, you can use PPP loans for that and have the repayment forgiven.
Smith: Chad Smith, Washington.
For a full breakdown of the COVID-19 relief bill, check out Market Intel.