Patricia, your reply:
"For an S-Corp, you may report a California Relief Grant on Form 100S as follows:
- Negative amount on 100S pg4-6 Schedule F, Line 5, with appropriate description
- Positive adjustment on Schedule M-1, Line 5b
- Positive adjustment on Schedule M-2, Line-3, column (b)"
The problem with this, it reduces the shareholder basis if we do it this way and it does not reflect anywhere on the K-1 and does not reflect properly on the basis statement. But tax exempt income should increase basis. Any idea how to properly record this
@PatriciaV
‎September 5, 2022
7:11 AM
