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Business & farm
Your balance sheet should balance without including that loan in the asset section.
The loan is not taxable and is not reported as income on form 1065.
In fact, the account entry when you received the loan is Debit Cash at bank and Credit Loans.
At year end, the loan remains unpaid and is reported as a liability. The cash at banks has been spent for business expenses and the balance at year end is reported on line 1.
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March 2, 2021
1:05 PM
18,126 Views