All,
The LLC I founded received an EIDL due to the Covid-19 disaster in July of 2020 under the provisions of the CARES Act. Now, 4.5 years later and while this loan which was to provide 6 months of operating capital, looks like it will get defaulted as the LLC has received no revenue since Sept. 2023 and the loan payments have been kept current with the members personal funds.
The Question: Are these loan proceeds considered to be income/unearned income/unrealized capital gains and will be taxable as income, even though the loan proceeds were used for expense purposes? There was some revenue between 2021 and 2023 but the expenses ate up the funds and the revenue was used for member/employee compensation.
Thanks
