Are shuttered venue operators grants taxable to California?

[qbteachmt]

I did a web search for you:

shuttered grant california tax

And found:

https://gpwcpas.com/grant-credit-loan-and-other-relief-comparison-chart/

And that is dated in May 2021. This matters, because of all the late legislative actions.

"California does not conform. Amounts not repaid are taxable and expenses are deductible."

[George4Tacks]

You are so nice to do googling that others could have done before coming here.
GO GIRL!

[qbteachmt]

Apparently, I'm good at developing which words to use for keywords for searching. Who could have imagined that was all I needed to use for the Search to work so well? I bookmarked that result, too.

[Kap2you]

When do you think you pick up the income in California - the year you received the grant or the year you have submitted your final accounting to the SBA and received confirmation of your  receipt.

You may have proven a use of the funds by 12/31/21 but you may not have heard back from the SBA or, if you received more than $750K, you'll need a single audit for final signoff and that can't be done until 2022 as guidelines have not been released?

I think when the final approval from SBA is received but curious what others think

[qbteachmt]

It's a loan until you are notified it's no longer owed. Or, when you are notified the Balance that is no longer owed.

[tax_investment_life]

Possible good news!

The CA Tax on SVOG may be removed, it is in the latest budget proposal:

https://lao.ca.gov/Publications/Report/4492

Search "Shuttered" on this page.  

[tax_investment_life]

It looks like it is now NOT taxable to CA under recently passed  SB113 (as of 2.10.2022)

https://www.gov.ca.gov/2022/02/09/governor-newsom-signs-paid-sick-leave-extension-expanded-relief-fo...

[qbteachmt]

Thank you for that update.

[lesliechia]

Thank you for your research, I really appreciate it and so do my clients!

[qbteachmt]

The earlier link has been updated to include SB 113. They didn't update the date at the top of that page.

[willatbird]

Am I correct in deducing that a SVOG from the city of San Francisco would be fully taxable because it's not from the state or the Feds?

[qbteachmt]

Any funds passed to Cities or Counties or public agencies came through the Feds to the States. If it truly is SVOG, it's not taxable. There are other business recovery grants, though, and most of these are taxable.

I like this link:

CA/Fed Grant

[willatbird]

They are calling it an Entertainment Recovery Grant. I can't find anything from SF that says it's from the Feds or CA.

Thanks for the link. that's a good one.

[qbteachmt]

I googled this:

san francisco entertainment recovery grant

And got lots of results that would apply. The issue comes from, is this for the Entertainment or for the Venue? Because there are a lot of Entertainment Grants issued, back to 2020, that are taxable. But the specific SVOG was never issued until 2021, for one difference. As I recall, some of the differences included, you don't qualify for SVOG if you also serve food.

You can research it, or I might have time later, but maybe not until tomorrow.

https://sfgov.org/sfc/give2sf/music-and-entertainment-venue-recovery-fund

https://sfosb.org/venuefund

[willatbird]

It's definitely this one, which indicates it's for COVID relief, but as far as I can see, it's not supported by the Fed or State SVOG. They were asking for civilian donations to the fund.

https://sfosb.org/sites/default/files/documents/Music%20and%20Entertainment%20Venue%20Fund%20Rules.p...

Appreciate your help. I had already seen those pages. I always like to see a statement like, "these funds must be included in gross income on your Federal return". LOL 

I'm going to call it taxable for both Fed and State and move on.

[qbteachmt]

Did you find your client on a specific Grant list? That's one of the easiest ways to determine what they got. Last tax year, a few preparers asked about fisheries grants, which were not stimulus grants but trade grants, so they had the wrong concepts entirely.

Here is one main difference: The Fed SVOG is administered by the SBA:

https://www.sba.gov/funding-programs/loans/covid-19-relief-options/shuttered-venue-operators-grant

not that local small business development office. I didn't catch that detail yesterday. Another is that the SBA shut down the program Aug 20, 201. But SF shows they have a new phase Jan 2022 with applications accepted Dec 2021.

Typically, the local grants are taxable for Fed, and simply entered as part of business gross revenue, and subject to SE, if that applies. Unless there is a specific provision excluding it (Fed or State) such as, County Health Depts issued grants to health care providers specific to HVAC or PPE and to Food Banks and those are usually excluded. You should be able to find that bill or law, though, that proves it.

[willatbird]

I did find it on the SF list and deemed it taxable income yesterday.

Thanks.

[qbteachmt]

@katfitzyoung 

No one here is using TurboTax.

You seem to be lost on the internet.

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

And try this screen, for the various topics (subforums): https://ttlc.intuit.com/community/discussions/discussion/03/302

Your sign in user info here is the same one you can use over at the TurboTax forum.

Thanks.