PPP Loan Forgiveness is messing with my M1

Forum|Forum|4 years ago
February 19, 2022
5 replies
28 views

My PPP Loan Forgiveness seems to be messing with my M1 which I don't need because my assets are <$250K. I use K-1 for my S-Corp and I'm using TurboTax for Windows desktop. I keep getting an error message that my M1 needs an entry for Tax Exempt Interest Out of State and it tells me to delete the entry on my K-1 line 16b which is that PPP loan forgiveness amount. What????? The system won't let me delete the M1 form from the forms list and it won't let me e-file. Entering the forgiveness amount into the M1 doesn't fix the issue, either. Please let your developers know about this problem and see if they can look into it. Or please tell me how to fix this so I can file and be done with my taxes. Thank you!

TurboTax Business Windows

AliciaP1

Level 13

Your Balance Sheet does not have to be reported because your assets or sales are <$250,000, but an S-Corp with forgiven PPP funds has to report the M-1.

However, your error is a known issue and we are working to resolve this. There is a workaround for this so you do not have to delay filing your return.

Please follow these steps:

In Step-by-step mode, under Business Info click the About Your Business tab
Click Continue until you get to the Forgiven PPP Loan page and answer No.
Switch to forms mode, click on Sch M-1 Wks.
Under Other permanent income items add the description "PPP loan forgiveness" and the dollar amount in the Per Books column.
Scroll down to Other permanent expense items, list the description "PPP funded expenses" and enter the amount of covered expenses for your PPP loan.
On the left, click PPP Loan Stmt
Scroll to the bottom of the page and respond to the questions on the Smart worksheet

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pioneerinnAuthor

Level 2

Thank you for your guidance. Your detailed instructions helped me get around the wrinkle and I just filed. This is why I recommend Intuit....you people are paying attention to your customers and are always helpful!