Restaurant Revitalization Fund (RRF)

[Bunnybear]

I have a client received Restaurant Revitalization Fund (RRF) which is under American Rescue Plan Act (ARPA). How the RRF should be recorded on tax form 1120S? 

[qbteachmt]

You asked in another existing topic, as well. Here is what I replied there:

@Bunnybear 

Did you click this link (and bookmark it for later):

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

RRF is there.

[Bunnybear]

Just to clarify, should this be reported on 1120S Schedule K line 16b?

Do you happen to know if RRF is taxable for Colorado?

Thanks!

[qbteachmt]

Here is Hickenlooper's announcement:

https://www.hickenlooper.senate.gov/press-releases/small-business-administration-announces-opening-o...

[qbteachmt]

I forgot to include this article link:

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

[Bunnybear]

I didn't find the Colorado tax regulation for RRF in this article. Did I miss anything? 

[qbteachmt · Accepted solution]

These are my understandings.

I have never seen another aggregated table like that one for CA. It has the resources referenced, so it still is useful as a starting place.

I see Hickenlooper held the work session and in that article, they state: "Grants under the Restaurant Revitalization Fund program are tax-free federal grants and do not need to be repaid."

That tells me two things: Tax Free and Not a loan.

CO has "rolling" conformity and they don't support anything passed for the tax year after the end of the tax year. ARPA (has RRF in it) was signed into law by President Biden on March 11, 2021. You are preparing 2021.

I found no specific CO provision that negates the Fed treatment, for 2021. Let us know if you find differently.