Restoration of Salt Deductions & PPP

Article Featured in July 2020 issue of Habitat Magazine

We hope everyone is doing well in these trying times. The President’s Coop & Condo Council is continuing its fight for our member Coop’s and Condo’s.

As you may be aware, the Heroes Act (COVID-4) is now before the US Senate, and negotiations to come up with a further relief package due to the ongoing COVID-19 pandemic should be beginning soon. There are two (2) extremely important provisions that could provide relief to Coop/Condo Homeowners in the form of the Restoration of the SALT Deduction and inclusion of Coops in the Payment Protection Program.

The PCCC has been working closely with U.S. Senator Schumer and his office on these issues, as well as the NY Congressional Delegation, with Congresspersons Suozzi and Meng as our main point persons. Below is an update on both issues.

Restoration of
Salt Deductions

The PCCC is fighting for the restoration of the full deduction of State and Local Taxes (“SALT”). This aspect of the Heroes Act that would greatly benefit Coop/Condo Homeowners. Coop/Condo Homeowners recently suffered a double hit when their property taxes increased exponentially and then they lost the full deduction for the payment of these taxes. These deductions, which have been in place for generations, were unceremoniously removed in the recent Tax “Cut” legislation.

Geoffrey Mazel, Esq., the PCCC General Counsel recently participated in a press conference held by Senator Schumer and Congressman Suozzi. Citing the dire need to deliver meaningful coronavirus financial relief to homeowners amid the unprecedented pandemic, U.S. Senator

Charles Schumer expressed his strong support to restore FULL State and Local Tax (SALT) deduction today. Schumer detailed how the SALT deduction cap is crushing the New York homeowners and middle class families harder than most other areas of the Country. Schumer said homeowners need this money right now as he announced his intention to add the restoration of the SALT deduction to the upcoming COVID-4 stimulus now in negotiation.

Payroll Protection Program (PPP)

As you are probably aware, the Payroll Protection Program excluded “passive entities,” which many argued included residential Coops. As a result, it is the opinion of many Coop professionals that a residential Cooperative does not qualify for the PPP loans.

A national coalition of Coop advocates, spearheaded by the PCCC, have pushed this issue in Washington DC, and the recent “Heroes Act,” which passed the House of Representatives in May, does include explicit language that make Coops available for the PPP program. In addition, the PCCC spearheaded this coalition to press the Treasury Secretary to include Coops in the PPP Program Administrative. This administrative fix would obviate the need to have the US Senate include it in the Heroes Act.