Intuit's Lacerte support says that the 1099-G grant gets reported on the 1040 line 8, not the Schedule C:
How to enter CA stimulus, PPP, & grants in Lacerte (intuit.com)
The IRS.GOV website seems to agree with what the person above says though - to report it on the Schedule C. Again, which is the correct answer. If we report it on Schedule C, then it gets hit with Self Employment tax. If we report it on 1040, Line 8, then it does not get hit with Self Employment tax:
Here is from IRS.GOV website:
Q. If governments use Fund payments as described in the Fund Guidance to establish a grant program to support businesses, would those funds be considered gross income taxable to a business receiving the grant under the Internal Revenue Code (Code)?
A. Yes. The receipt of a government grant by a business generally is not excluded from the business's gross income under the Code and therefore is taxable. However, a grant made by the government of a federally recognized Indian tribe to a member to expand an Indian-owned business on or near reservations is excluded from the member's gross income under the general welfare exclusion.
