24 Sep Lenders Will Not File Form 1099-C For Forgiven PPP Loans
To prevent confusion, the IRS notified lenders on Tuesday that they should not file cancellation-of-debt information returns or furnish payee statements under Sec. 6050P to report the amount of qualifying forgiveness with respect to covered loans made under the Paycheck Protection Program (PPP) (Announcement 2020-12).
The PPP was created under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, P.L. 116-136, and it allows qualifying businesses to obtain loans guaranteed by the U.S. Small Business Administration. Eligible loan recipients are eligible for forgiveness of indebtedness for all or a portion of the stated principal amount of a covered PPP loan if certain conditions are satisfied, and the forgiven amount is excluded from the borrower’s gross income.