Mark L. Brasee402.978.5306
firstname.lastname@example.org email Mark
Importantly, the IFR is critical to properly calculating the payroll costs allowable toward forgiveness of a PPP loan. The owner-employee compensation rule limits the amount of compensation of an “owner-employee” to 2019 compensation in order to avoid a situation where an owner-employee uses his or her position of ownership to increase his or her level compensation at the government’s expense and potentially at the expense of the employees of the borrowers. The owner-employee compensation rule was summarized in our Client Update here.
In connection with the owner-employee compensation rule, owners of more than one business should be aware that, for payroll cost allocation purposes, an individual’s payroll compensation is subject to the cap across all businesses in which an owner has an ownership stake; provided that owners may choose how to allocate the capped amount across different businesses. See SBA’s discussion of this issue available here at Question #8.
A copy of the IFR can be found here.
A printable version of this information can be found by clicking HERE.
This article has been prepared for general information purposes and (1) does not create or constitute an attorney-client relationship, (2) is not intended as a solicitation, (3) is not intended to convey or constitute legal advice, and (4) is not a substitute for obtaining legal advice from a qualified attorney. Always seek professional counsel prior to taking action.
Who We Service