HB1446 Passes Allowing Expense Deductions for B2B Grants, EIDL Advances, MS Rental Assistance Payments, and PPP#2 Loan Forgiveness
The House and Senate adopted MSCPA’s HB1446 March 28 with MSCPA successfully amending the bill to include the deductions of expenses for EIDL advances(grants) and MS Rental Assistance Payments, in addition to MS Back To Business (B2B) grants for Mississippi purposes. The Governor signed the bill on April 14.
Proactively, the bill also allows for the deduction of expenses for PPP#2 loan forgiveness created in the Consolidation Appropriations Act passed in December. During the 2020 MS Legislative session, MSCPA was successful in including the deduction of expenses for PPP#1 created in the CARES Act via HB1748.
The effective date is March 27, 2020, which coincides with the date of the CARES Act.
MDOR previously advised that deductions of expenses paid with MS COVID 19 Business Relief Payments ($2,000) would be deductible provided that such expenses are deductible otherwise.
These COVID relief funds are nontaxable to Mississippi. By allowing the deduction of expenses, taxpayers will now receive the full advantages of the funds, and tax preparers will benefit from the consistent treatment of the expenses in line with Federal.
Special thanks to members of the Legislation & Taxation Committees for their time, expertise, and due diligence throughout the Legislative process from beginning to end to make this bill a reality.
REPORT OF CONFERENCE COMMITTEE
1 AN ACT TO AMEND SECTION 57-121-7, MISSISSIPPI CODE OF 1972,
2 TO ALLOW AN INCOME TAX DEDUCTION FOR OTHERWISE DEDUCTIBLE EXPENSES
3 IF THE PAYMENT FOR SUCH EXPENSES IS MADE WITH THE GRANT OR LOAN
4 PROGRAM OF THE PAYCHECK PROTECTION PROGRAM AS AUTHORIZED UNDER THE
5 CORONAVIRUS AID, RELIEF, AND ECONOMIC SECURITY (CARES) ACT AND THE
6 CONSOLIDATED APPROPRIATIONS ACT OF 2021, THE COVID-19 ECONOMIC
7 INJURY DISASTER LOAN PROGRAM, THE 2020 COVID-19 MISSISSIPPI
8 BUSINESS ASSISTANCE ACT, AND/OR THE RENTAL ASSISTANCE GRANT
9 PROGRAM, AND SUCH EXPENSES ARE ALLOWED AS DEDUCTIONS FOR FEDERAL
10 INCOME TAX PURPOSES; AND FOR RELATED PURPOSES.