Is a CARES ACT grant to a business subject to self employment tax?

[qbteachmt]

Aug 18, 2020, my State uploaded this document:

https://mtrevenue.gov/wp-content/uploads/2020/08/CARES-Act-.pdf

It's very thorough. For example:

"Grant funds from MMPIG, MBAP, MBSP, MIGP, MFAAP, and SCG programs are required to be included in a grant recipient’s gross income if the recipient is a business. Under IRC § 61, all gains or undeniable accessions to wealth, clearly realized, over which taxpayers have complete dominion or control over are considered taxable income unless specifically exempt. Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955), 1955-1 C.B. 207. Recipients of all five grant programs have discretion on how to spend those funds (within the parameters of the program). Therefore, payments made under the five grant programs are included within the broad definition of “gross income” under IRC § 61.

Prior to the Tax Cuts and Jobs Act (TCJA) of 2017, corporations could omit contributions to capital from their gross income. However, TCJA removed the exemption for contributions of capital from government entities. Because the grants are from a government entity, corporations must also include the grants received as taxable income. See IRC § 118(b)(2).

It should be noted that while a grant recipient is required to include the grant in its gross income, it can deduct and/or capitalize the business expenses it paid for with grant funds.

Organizations formed under IRC § 501 are exempt from taxation unless they receive income unrelated to their charitable mission under IRC § 511. If organizations are formed under IRC § 501 and the grant funds are related to the organization’s mission, they will be exempt from taxation under IRC § 501. Therefore, grant funds from the LGRP, PHG, SCG (to non-profit organizations), FBFPAG, SSNG, and TAG are not taxable. The target recipients for the LGRP and PHG are local and tribal governments along with organizations they control. Governments and governmental units are not subject to income tax.

Finally, TAG funds recipients are individuals with disabilities. These grants are created to keep disabled individuals working. It is unclear if local non-profit organizations or the individuals will receive the funds directly. However, if the funds were to go directly to individual recipients, the funds would fit within the broad definition of IRC § 139(b)(4), which states that “qualified disaster relief payments” are an amount paid to or for the benefit of an individual by a Federal, State, or local government, or agency or instrumentality thereof, in connection with a qualified disaster in order to promote the general welfare. The department believes that keeping individuals employed constitutes “general welfare.” If the funds were to go directly to the local non-profit organization to disburse to disabled individuals, the same logic would apply to those organizations as described above. If the organization is organized under IRC § 501 and the grant funds are related to the organization’s mission, they would be exempt from taxation under IRC § 501."