Skip to content

Allow KY Small Business to Deduct Expenses Paid with COVID-19 Loans

Allow KY Small Business to Deduct Expenses Paid with COVID-19 Loans

January 11, 2021 Last Edit: June 5, 2025

Allow KY Small Business to Deduct Expenses Paid with COVID-19 Loans

NFIB State Director Tom Underwood said today that small businesses across the commonwealth are calling on lawmakers to pass a measure allowing them to deduct forgiven expenses paid for with federal Paycheck Protection Program (PPP) loans on their Kentucky income taxes.

“You’re allowed to deduct these expenses on your federal income taxes, but Kentucky says you can’t deduct them on your state taxes, and that’s not fair,” Underwood said. The federal COVID-19 recovery act signed into law last month reversed an IRS ruling and clarified that PPP forgiven expenses are deductible.

“The pandemic has taken a tremendous toll on Kentucky’s small businesses, and a lot of them are barely hanging on,” Underwood said. One in four small businesses nationwide surveyed last month by the NFIB Research Center warned they would have to close within six months unless economic conditions improve soon.

“We need the General Assembly to relieve some of the financial pressure bearing down on them by allowing them to deduct costs associated with staying open and keeping people employed during the pandemic,” Underwood said.

Get to know NFIB

NFIB is a member-driven organization advocating on behalf of small and independent businesses nationwide.

Receive our newsletter and email notification
Knowledge is power. Let us help you stay informed with breaking legislative news, regulatory updates, business tips, and more.

Related Articles

Congressman Randy Weber Addresses Small Business Community in Galveston
September 2, 2025
Congressman Randy Weber Addresses Small Business Community in G…
NFIB thanks Rep. Weber for standing up for Main Street by making the 20% Sm…
Read More
September 2, 2025
Tuscaloosa, Mountain Brook Sue State Over Online Tax Collection…
NFIB is following the case, which could affect small businesses statewide.
Read More
September 2, 2025
NFIB Launches Small Business Deduction Thank You Ads for Lawmak…
NFIB launches digital, billboard, and radio ads in key states thanking lawm…
Read More
September 2, 2025
Congressman Randy Fine Tours Bunnell Small Business & Meets…
Owners discussed the Small Business Deduction and other tax wins
Read More

© 2001 - 2025 National Federation of Independent Business. All Rights Reserved. Terms and Conditions | Privacy Policy | Accessibility