Lacerte is treating PPP loan proceeds as taxable income for CA purposes. Anyone able to provide thoughts on this treatment? Corporation did not experience reduction in gross revenue above 25% threshold so expenditures are not deductible in 2020. Am I missing something?
I assume you mean their gross receipts were more than 25% of the prior year. If that’s the case, the expenses are not deductible and will increase CA income. If the gross receipts were less than the prior year you don’t make any adjustments. I believe you enter the amount of CA expenses in a box but not sure,