I have a sole proprietorship. I had to shutdown due to Covid and took out an EIDL loan of $10,000 to purchase gear to work remotely. As I understand it, this loan money is not taxable income.
I am categorizing the gear I purchased as Assets and deducting costs via Section 179.
We took out a large home loan for unrelated home improvements and decided to deposit $10k of that money into my business account to pay back the EIDL early.
Is this $10k categorized as taxable income my Schedule C? Since I am not using earned income through the business to pay back the loan, and am deducting the value of my purchases, I'm not sure how to treat this.
Thanks for any guidance.
