PA treatment of forgiven PPP loan proceeds

[MDCPA]

Per PA Dept of Revenue Website:

Taxability of Paycheck Protection Plan Loans

"Paycheck Protection Plan loans used to pay business expenses during the COVID-19 pandemic that are subsequently forgiven by the lender will constitute as taxable income for Pennsylvania personal income tax purposes. The business can deduct proceeds from the forgiven loan that are used to cover ordinary, necessary and reasonable business expenses related to that income."

"For corporate net income tax, Pennsylvania taxable income is based upon federal taxable income. Pennsylvania law does not include an add back to or deduction from federal taxable income for forgiveness of a Paycheck Protection Plan loan."

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Is this saying that corporations will not have any addback for the forgiven loan and will also get to deduct expenses paid with forgiven PPP loans (since based on federal taxable income) but self employed (sch C filers) will have taxable income for the forgiven loans?  I know the expenses will be deductible if paid from the forgiven PPP loan but this isn't the same treatment as the corps get?

[Lion EA]

And, does that say that pass-through income from Forms K-1 (partners in partnerships, shareholders in S-corporations) WILL add back expenses the partnerships and S-corporations deducted that were paid with PPP Loans?!

[ATA Associates PC]

What year us the forgiven PPP loan recorded as income, the year the loan is given (2020) or the year the loan is forgiven (2021)

[email protected]

 

[Lion EA]

It's a loan when received and nontaxable income when forgiven.