AICPA gives Congress recommendations on coronavirus relief legislation

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The American Institute of CPAs offered six policy suggestions for the next phase of federal COVID-19 relief legislation under consideration in Congress.

Lawmakers are meeting this week to discuss the fifth round of legislation in response to the coronavirus pandemic. Among the issues under consideration are President Trump’s demand for a payroll tax cut, which is opposed by many Democrats and some Republicans, as well as an extension in the enhanced unemployment benefits of up to $600 per week, which are due to run out later this month. Some Republicans in Congress want to reduce that amount, arguing that it provides a disincentive for returning to work. Lawmakers are also considering additional funds for coronavirus testing, schools, the Paycheck Protection Program, the Centers for Disease Control and Prevention, and another round of stimulus payments. Some companies are also pushing for the ability to claim tax credits this year on a refundable basis.

Senate Majority Leader Mitch McConnell, R-Ken., is insisting that any legislation include liability protections for businesses against lawsuits from employees or customers who contract coronavirus, a controversial provision that the AICPA also favors. The AICPA also backs additional aid to state and local governments and deductions for expenses related to the Paycheck Protection Program.

The AICPA has a set of a half-dozen recommendations that it has sent to congressional leaders in both parties and chambers. “CPAs are on the front line helping small businesses and other organizations understand and access coronavirus relief resources, such as the Paycheck Protection Program (PPP),” said AICPA president and CEO Barry Melancon in a statement Monday. “These accounting professionals are trusted (pictured) advisers to millions of organizations across our nation, and they tell us that small businesses continue to struggle. We call on congressional leadership to not delay in finding bipartisan consensus on additional relief and recovery legislation, and to include provisions such as ours that reflect the true and immediate need of organizations today.”

The AICPA’s recommendations are:

1. Allow full deductions for Paycheck Protection Program-related business expenses: To uphold Congress’ intent that PPP recipients receive the full benefit of a PPP loan, AICPA supports bipartisan legislation clarifying that receipt and forgiveness of coronavirus assistance through the PPP does not affect the deductibility of ordinary business expenses. (Read letter of support.)

2. Provide information and tools to further simplify PPP loan forgiveness application process: It is critical that all PPP borrowers have access to key guidance from the SBA and Treasury, as well as tools to easily determine and apply for the forgiven amount. AICPA supports bipartisan, bicameral legislation (H.R. 7413 / S. 4171, the Calculate PPP Forgiveness Act of 2020) that would require the SBA and Treasury to provide or certify free, publicly accessible PPP loan forgiveness calculators. (Read statement.)

3. Remove unnecessary and unfair tax obstacles to remote work: The AICPA has long called for simplifying complex tax reporting rules employers and employees face as a result of numerous state income tax laws and varying de minimis exemptions when employees work outside their home states. We support bipartisan legislation, S. 3995, the Remote and Mobile Worker Relief Act of 2020, which reaches a balance between states’ rights to tax income and the needs of individuals and businesses, especially small businesses, to operate efficiently in this economic climate. (Read letter of support.)

4. Allow Section 501(c)(6) associations and organizations access to PPP: Local 501(c)(6) organizations are currently ineligible for assistance through the PPP. Many AICPA members serve these organizations, which are suffering from event and meeting cancellations. The AICPA said it appreciates the strong bipartisan congressional support on this issue and urge Congress to include language allowing section 501(c)(6) organizations access to the PPP in the upcoming package.

5. Provide additional federal fiscal relief to state and local governments: Without appropriately targeted federal assistance, state budget shortfalls could trigger new state taxes on many already-struggling small businesses. CPAs have sounded the alarm on the urgent need for more direct federal aid to states and localities to keep our economic recovery on track. The AICPA is urging Congress to include meaningful federal aid for state and local governments in the upcoming package.

6. Adopt new coronavirus-related liability provisions: The AICPA said it is concerned about a wave of coronavirus-related lawsuits against employers trying to operate safely in an uncertain environment. The Institute believes employers and employees need to feel safe and confident about returning to work, and new temporary and targeted liability protections that do not dampen key legislative package.

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AICPA Coronavirus Finance, investment and tax-related legislation Paycheck Protection Program Tax relief