Where to adjust PPP-funded business expenses for AB 80 conformity for CALIFORNIA?

[Gildardo]

Where to adjust PPP-funded business expenses for AB 80 conformity in California Returns?

If PPP-funded expenses were deducted for federal purposes but those were not eligible for a California deduction according to a not 25% gross receipt reduction where do I enter the adjustment?

I was looking at this post from Intuit but is just a reminder to look into it (at the very very end).

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

I tried this, will that be sufficient?

[qbteachmt]

What does this mean: "just a reminder"

Did you expand that link to see all the instructions for CA?

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

It's not a reminder. It's instructions.

[Gildardo]

This all I found:

How do I apply A.B. 80 conformity?

Amounts you have entered in Other Expenses on the federal return will still flow to CA as a deduction.

We have introduced an informational diagnostic to remind you that your entry may need to be reduced or removed, depending on which type of funds it represents. You may need to adjust the amounts for California to those that are allowed.

[qbteachmt]

Did you click the Link in the topic link you were given (that you found), at the bottom, where you see:

How to enter CA stimulus, PPP, & grants in ProSeries

It has this arrow:

🔽

And when you click something like that, it expands, so the arrow is sideways, and now you see about three screens' worth of text instructions.

[qbteachmt]

I found another article for you:

https://proconnect.intuit.com/community/state-taxes/help/how-to-enter-california-ppp-eidl-relief-gra...

Surprisingly, the Intuit info there is wrong about SVOG. You really need to understand this for yourself, and then review the return to see if you got the results you need.

[Gildardo]

Yup. Very helpful information how to enter the CA grants (taxed on federal, but no taxed on California) but not instructions for a PPP (taxed on California in this case).

What's an ineligible entity under AB 80?
An entity is ineligible to deduct expenses paid with forgiven PPP funds if it didn’t have a 25% or greater reduction in gross receipts in any calendar quarter in 2020 compared to the same calendar quarter in 2019.

[Gildardo]

Thanks, I will look into this.