James214
Level 1
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Where do I deduct the PPP money forgiven on my 1120S tax return?  

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IRonMaN
Level 15
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Intuit Turbo Real Money Talk Community

ACME Taxes, Tatoos, Tires and Turtles (I've expanded my line of products to better serve you)
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qbteachmt
Level 15
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To clarify: Forgiven PPP money is not Deductible. It already isn't Taxable. It's Free Money. You don't also get to deduct it.

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James214
Level 1
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Sorry let me say it another way.  It should reduce expenses?  Therefore it should be a reduction/income in the tax return when forgiven?  Is this correct?  In fact you spent the money so the net is zero.  However the books will have to show this money as cash in the books and offset as what?  That was the question.  Will the IRS try and match this on the tax return?  

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qbteachmt
Level 15
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@James214 

You seem to be lost on the internet.

You’ve come to a Peer User community for Intuit Tax Preparation products supporting tax preparation professionals using ProSeries, Proconnect and Lacerte , and you may be looking for support as an individual taxpayer. Please visit the TurboTax Help site for support.

Thanks.

 

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James214
Level 1
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No I am a Tax Professional using ProSeries.  A client of mone who files a SUB S tax return shows PPP money as other income.   I am asking what is the tax software doing about this?  Is the IRS requesting a separate line to reconcile this?  I think this is a good question.  If it does not come out now it will.  So again if you don't know just say so.  Otherwise have you heard anything on this issue? 

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sjrcpa
Level 15
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It's tax exempt income on the 1120S, a book tax difference, goes to OAA, and increases basis.


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James214
Level 1
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I appreciate the answer.  Do we have to wait for forgiveness from the bank first?

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IRonMaN
Level 15
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Yes

ACME Taxes, Tatoos, Tires and Turtles (I've expanded my line of products to better serve you)
qbteachmt
Level 15
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If it isn't forgiven yet, that makes it a Loan, or debt obligation.

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qbteachmt
Level 15
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"I am a Tax Professional using ProSeries."

The article for that specific program is here:

https://proconnect.intuit.com/community/business-income-taxes/help/how-to-enter-forgiven-ppp-loans-i...

And I didn't find this for ProSeries, but this is new and seems useful: https://proconnect.intuit.com/community/balance-sheet/help/tax-basis-capital-account-reporting/01/12...

 

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