Revenue Procedure 2021-20 provides a safe harbor for certain taxpayers that received a loan pursuant to the Paycheck Protection Program (PPP) and, based on guidance issued by the Treasury Department and the IRS prior to the enactment of the COVID-related Tax Relief Act of 2020, did not deduct certain otherwise deductible expenses paid or incurred during the taxpayer’s taxable year(s) ending after March 26, 2020, and on or before December 31, 2020.  Under the safe harbor, these taxpayers may deduct the expenses in the immediately subsequent taxable year.  This revenue procedure also obsoletes Revenue Procedure 2020-51. 

Revenue Procedure 2021-20 will appear in IRB 2021-19, issued on May 10, 2021.