SALT LAKE CITY – Some small business owners in Utah are getting some unexpected tax bills connected to their use of Payroll Protection Program money from the federal government. One lawmaker is proposing a bill that would create grants to help business owners with these expenses.
District 32 Representative Suzanne Harrison says some small business owners are telling her how surprised they were when they went to file their state taxes. She says PPP loans were not going to be considered as taxable income for federal taxes, however, she says the state looks at those loans a different way.
“Utah currently plans to treat the forgiven loans as taxable income,” Harrison says. “Businesses that received up to $150 thousand in federal Paycheck Protection Program loan forgiveness are now getting unexpected tax bills from the state.”
She’s promoting House Bill 445, which would create grants of up to five thousand dollars to help business owners pay their state taxes. However, she says the grants would only go toward employers that accepted no more than $150 thousand in federal money. Plus, it would only go to business owners that went through an economic downturn during the year.
Harrison says, “You would have to have seen a loss in revenue of 25% from 2019 to 2020. So, we’re really trying to target those struggling, small businesses.”
Harrison acknowledges that time is quickly running out on the 2021 legislative session, so she has doubts that her bill would be considered before Friday. However, she would like to bring the bill back for discussion during a special session.
“It looks like it’s not going to be addressed this year,” she says.
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