IRS provides answers for certain transportation companies eligible for Treasury grants

IRS Newswire July 6, 2021
News Essentials What's Hot News Releases IRS - The Basics IRS Guidance Media Contacts Facts & Figures Around The Nation e-News Subscriptions The Newsroom Topics Multimedia Center Noticias en Español Radio PSAs Tax Scams The Tax Gap Fact Sheets IRS Tax Tips Armed Forces Latest News Home IRS Resources Compliance & Enforcement Contact My Local Office Filing Options Forms & Instructions Frequently Asked Questions News Taxpayer Advocate Where to File IRS Social Media	Issue Number:    IR-2021-145 Inside This Issue IRS provides answers for certain transportation companies eligible for Treasury grants IR-2021-145, July 6, 2021 WASHINGTON — The Internal Revenue Service today posted answers to questions that certain transportation companies may have regarding Treasury grants and related taxes. The Coronavirus Economic Relief for Transportation Services (CERTS) Act of the Consolidated Appropriations Act of 2021 authorizes the Department of the Treasury to provide grants to  transportation service providers--including eligible motorcoach companies, school bus companies, and passenger vessel companies-- that experienced annual revenue losses of 25 percent or more as a result of COVID-19. These companies must generally prioritize the use of the grants for payroll costs, though grants may be used for certain operating expenses (including the acquisition of services and equipment needed to protect workers and customers from COVID-19) and the repayment of debt accrued to maintain payroll.  Funds not used for eligible activities within one year of receipt of the grant must be returned to the Treasury Department. The FAQs posted today answer two important questions: Are the grants taxable? Yes, the receipt of a CERTS Act grant is not excluded from the recipient's gross income under the Code and therefore is taxable. Are costs for which the grants are used deductible? Yes, the costs are deductible to the extent that they are otherwise deductible under the law. The tax law generally permits the payment of wages, salaries, and benefits to employees and other amounts paid to carry on a trade or business to be deducted as ordinary and necessary business expenses. Additional information about tax relief for businesses affected by the COVID-19 can be found on IRS.gov. Back to Top         Thank you for subscribing to the IRS Newswire, an IRS e-mail service. If you know someone who might want to subscribe to this mailing list, please forward this message to them so they can subscribe. This message was distributed automatically from the mailing list IRS Newswire. Please Do Not Reply To This Message.

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