News Release: Report on PPP loans, CARES Act tax policies
NEWS RELEASE from the Platte Institute
Contact: Adam Weinberg
Report: PPP retained more than 300,000 Nebraska jobs
Decoupling from CARES Act could hinder recovery
OMAHA, NE — A new Platte Institute report on Nebraska’s participation in the Paycheck Protection Program (PPP), and tax provisions included in the federal CARES Act, is now available on PlatteInstitute.org. A PDF of the report is attached at the bottom of this release.
Platte Institute Policy Director Sarah Curry and Policy Intern Jaliya Nagahawatte are co-authors of the report, which includes 8 graphics including details on the geographic distribution of PPP loans and loan amounts in Nebraska, and types of businesses and industries that are participating in the program. The graphics can be found here and may be republished with attribution.
The small business loans provided by the Paycheck Protection Program are one of the largest relief measures in the CARES Act. Nebraska employers received 42,497 loans amounting to more than $3.4 billion, retaining 327,536 jobs.
In Nebraska, 90% of PPP loans were for amounts under $150,000, and 72% of the businesses receiving the loans file their taxes as individuals, not under the corporate income tax.
The public release of PPP data by the Small Business Administration comes as the Nebraska Legislature prepares for a return to the 2020 session next week. Lawmakers have started discussing whether the state should maintain its conformity with federal tax provisions in the CARES Act, which includes expanded charitable deductions and increasing the amount of past net operating losses businesses can deduct.
The federal law also makes loan forgiveness under the PPP tax-free. Typically, loan forgiveness is treated as taxable income.
“The tax relief provisions in the CARES Act are intended to ensure jobs and small businesses are not needlessly lost as the COVID-19 crisis continues into the latter half of 2020. If the state decouples from the CARES Act’s tax policies, it will put an additional burden on small businesses and agriculture producers that are already hurting by subjecting them to a tax increase,” said Sarah Curry.
Here are other highlights from the report:
- Businesses in Nebraska’s 3rd congressional district received the greatest number of loans in the state. This is partly due to the agriculture sector being one of the hardest-hit industries, amounting for 18.6% of the state’s loans and 7,905 jobs.
- In total, 40 cities across the state supported more than 1,000 jobs each with PPP loans.
- The largest percent of jobs retained under PPP in Nebraska was in the health care field (16%), followed by accommodation and food services (11.3%), and construction (10.8%). The industries that received the greatest number of loans were agriculture (18.6%), construction (11.6%), and other services (11.1%), which includes religious organizations, beauty salons, general automotive repair, and personal care services.
For more information, please contact Adam Weinberg at (402) 500-0209 or firstname.lastname@example.org.
The Platte Institute advances policies that remove barriers to growth and opportunity in Nebraska. More media resources are available at PlatteInstitute.org/Media.