Reporting small business loans converted to grants

July 8, 2020

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Q.¬†As a city, we offered interest free emergency small business recovery loans, of no more than $10,000 per business, to assist in keeping them afloat until they received their funds from the CARES Act. Repayment doesn't start until January 2021, in 16 equal consecutive payments with the last 25% forgiven, if previous payments were made timely. The forgiven amount will be reported as revenue on a 1099, in the year is was forgiven. Are we correct in that assumption? Now there is talk of turning…

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