@ConsciousHumanMed You can deduct the expenses on your federal business income schedule if they are ordinary and necessary for your business. So, you enter the grant income and related expenses on your business tax schedule, be that a schedule C for a sole proprietorship (on your personal tax return) or on form 1065 (for a partnership) or form 1120-S for an S corporation. Thus, the grant income and expenses would be reflected in your business net income, so they wouldn't be entered again elsewhere on your federal or state tax return.
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