California Small Business COVID-19 Relief Grant

[lisajoyg]

Thanks for you quick response. I did start my CA State Return and I haven't seen such a question, so I'll make sure to look for that and have TurboTax walk me through everything. 

[azrealty92507]

For the Business Version, even I went through the step by step, it did not ask for this adjustment. I ended up open Form, and enter it manually.  

[lisajoyg]

Was this for California? If so, can you share where please?

[azrealty92507]

Yes. It is for CA, Business version, desk top version. I have a S Corp.   I don't know if it is me or Turbo tax does not include this on the desk top version for Business version, I can not find this step to enter.  I think this is a major fault of Turbo Tax. I hope someone from Turbo tax is monitoring this and get it fixed. 

I ended up open Form, find 100S on the drop down box, enter the amount 100S  Line 12 “Other deductions” line.   

Someone also wrote "

I have a 2021 S Corp. I input the grant as Other Income on the Federal 1120S. To get the results Safwan lists above at February 7, 2022 at 9:33 am, I input the grant on Lacerte screen 44.011, California Conformity Adjustments to Sch K.  I also input in the Tax Exempt Section for Income Recorded on Books Not Included on Sch K. Screen 31.1 but just in State if Different Column.

On CA form 100S, the grant is included in Other Deductions line 20, schedule F and it shows up on CA Sch. M-1, line 5b.  It correctly reduces K-1 Ordinary Income."

[lisajoyg]

I'm reading and re-reading your response. What a mess. I'm a Sole Proprietor. My State only went up a few dollars. I'm tempted to just leave it be.

[azrealty92507]

if you are a sole proprietor, you might be using Home and Business version, either online or desk top.  I used Business version is totally different version. You might be lucky and don't have my issue

[lisajoyg]

Yes, I'm using Desktop Home & Business and I've not seen the question, but I will revisit the State return sometime this week. I needed a break as it is so frustrating. I see someone used the online version of SE, never even knew that existed and there were questions asked about this.  I paid for desktop version, I'm not going to buy an online version now as well now.

[lisajoyg]

I will be using Other Income. The challenge now is the State as I'm being taxed and shouldn't be.  I wish TurboTax Desktop would have had this in their software, as it's causing so many issues.

[GeorgeM777]

Because you are using TurboTax Home & Business, follow these steps to remove the COVID Relief Grant from your CA return:

1. Under State Taxes, click on Income and adjustments.
2. On the next page, under the Business subheading, select California Microbusiness COVID-19 Relief Grant
3. On the pages that follow, enter the amounts of your COVID Relief Grant which will be excluded from gross income on your CA return.

@lisajoyg

[lisajoyg]

Hi George,

I started working on my taxes today and there was a California Update and actually Grant questions now.  So, I entered my Grant amount and the owed to CA went away 😉 Thanks for your help.

[mb8792]

I misplaced the 1099

can someone share the Payer name and ID please & thank you!

[Haliuna]

Thanks! I'm using Turbotax and I entered the grant amount (1099-G) under Business income - General Income, but it doesn't say anywhere in this section about taxable grants. I hope I entered it in the correct place.

[Haliuna]

Thank you! It didn't make any difference in the outcome, but I'm glad I re-entered it in the correct place. Also, I entered the grant amount on my CA return as well. That means I entered the same amount twice. I hope it's right. 

[KrisD15]

Yes, that is correct. 

You need to enter the amount again in the state section so the program knows to subtract that from your taxable California income. 

@Haliuna

[mtnmanager]

Dear George,

Thank you for your post,

By far, yours is the best answer for the small business grant even for 2023.  As a sole-proprietor that uses Home & Business, where should I put the grant total posted in Box 6 of the 1099 for a covid-19 small business grant in California?

Home & Business lists 4 categories that do not include 1099-G by name:

1099-Nec,  MUSC, K

General In come for NO Form

Other Income (cash prizes, paid bad debts...) and allows you to write a one line description

such as ARPA Sball Business Grant

Income you gave back

What do you suggest to add the grant money to the Business sales & services.

Thank you MM

in to