Support Center

<- Back to Main Page

Where do I report my PPP Loan forgiveness on a 1120 - Where do I report my PPP Loan forgiveness on a 1120, 1120S, and 1065 using SureFire?

---

📊 Step-by-Step Guide

Step 1: Understand how PPP forgiveness should be treated

Use this when you need to know the accounting and tax treatment.

For accounting purposes, PPP loans should be treated the same as other business debt. For tax purposes, once forgiven, it would be reported as tax-exempt income instead of as cancellation of debt income.

Step 2: Report PPP forgiveness on a 1120S

Use this when you are preparing a 1120S return.

1120S page 3, Sch K, line 16b Other Tax-Exempt Income worksheet.

Following this method, the tax-exempt income will be included in the Basis calculation on Sch K-1, and the 1120S Sch M-1.

Deductible PPP-related expenses can be included along with other business expenses.

No special adjustments or reporting is required. Unless further guidance is issued, no additional changes are expected at this time

Step 3: Report PPP forgiveness on a 1065

Use this when you are preparing a 1065 return.

1065: 1065 page 4 line 18b

Step 4: Report PPP forgiveness on a 1120

Use this when you are preparing a 1120 return.

1120: M-1 line 7 as non taxable

📝 Additional Notes

1120S page 3, Sch K, line 16b Other Tax-Exempt Income

1065: 1065 page 4 line 18b

1120: M-1 line 7 as non taxable

Tags: federal,form