The advance from everything I've gathered is fully forgivable and is not a loan such as the EIDL loan or PPP loan (partially forgivable) I am not utilizing the EIDL loan or the PPP, solely the advance. In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an EIDL advance of up to $10,000. You can record your Paycheck Protection Program loan through QuickBooks and continue paying or re-hire your employees. The EIDL Grant will not become part of any loan unless you accept other funds from the SBA, so I am simply booking the grant directly to the "other income: EIDL Program". As mentioned in your answer, EIDL Grant is not taxable and need not to report on 1120S or 1120. If this loan ends up being forgivable, would I then have to go back and record $100k as “other income”? I'm always here to assist you. Hello,  I deposited my EIDL loan into a separate checking account that is linked to my regular account. Communications from the SBA will come from an official government email with an @sba.gov ending. Yes, the grant is tax exempt and because it is not a loan and does not have to be repaid. One correction: I made the initial bank deposit in QB to our "Base" account where the SBA put the EIDL funds first, then did a Bank Transfer over to the new EIDL Funds bank account where I moved the money to. Stay safe. payable and am not sure how to handle this if I have a new checking account. If you never get an EIDL loan then your upfront 10k is a tax free gift but will assuredly have a tax line in the income section to account for it - income but non-taxable. 6) Created a new Vendor account for the SBA who made the EIDL loan. It would be an adjustment to the capital account and cash when received. You need to go into the Forms mode to make the entry. Where do I input this information? Kelvin Richards Last Updated: January 30, 2021. March 27, 2019 . I want to make sure that it is very clear how the money is being used when I present the info to the SBA. Hi - I've been struggling with this too, and going round and round with QBO support. Looking for specific step by step instructions. But for now, call it a loan. However, I used to have an outside bookkeeper who would review everything at the end of the year to wrap things up ahead of the annual tax appointment with my CPA. The SBA will initially reach out to previous EIDL Grant applicants that only received a partial EIDL Advance (between $1,000-$9,000). The other income account type is in a separate drop-down on QuickBooks Desktop. How do I record an initial EIDL loan advance/grant... How do I record an initial EIDL loan advance/grant (max $10k, does not need to be repaid) under Cares Act? I had a GROSS amount of the loan (example $1,000.00) entered as a CREDIT. I don't see any reason to book it as a loan unless you know the client is planning to accept more funds from the SBA … You still record it as a loan. The instructions are listed below. It may not need to be repaid but it is  deducted from your eventual EIDL loan amount. When you see the list of forms on the left side of your menu bar, choose Form 1120S p3-5 and then you will find line 16 (b) on page 4. How do I record the funds received for the EIDL? 7) Made a Bank Deposit in QB as shown in the attached screen capture: - "From Account" is the EIDL Loan account (Long-Term Liabilities), - "Memo" is "EIDL Loan Deposit from SBA" or words to that effect, - "PMT Method" is EFT or whatever you want to use, - "Class" (we're a nonprofit) is Restricted Income - but could be a special Class setup for EIDL funds. Once done, you can now create a journal entry. Create a new account. QuickBooks Online, QuickBooks Self-Employed, QuickBooks ProAdvisor Program, QuickBooks Online Accountant, QuickBooks Desktop Account, QuickBooks Payments, Other Intuit Services, QuickBooks Self-Employed, QuickBooks ProAdvisor Program, QuickBooks Online Accountant, QuickBooks Desktop Account, QuickBooks Payments, Other Intuit Services. Sales Tax. field to enter any identifying number from the payment receipt. From my accountant: The best way to record the EIDL stimulus deposit would be to record the deposit and the income account it should go to would be "Nontaxable income - 2020 Economic Stimulus" under Other Income. Before adding the amount, you'll have to select when do you want to start tracking your finances from the EIDL account. Open the journal entry made in the chart of account and click 'EDIT'. The funds will allow you to continue to run payroll and pay your employees . We have only received funding for the loan. Products, Track Grants count as income, but they are not a part of your normal business. (aka bank account)? First off, you'll have to set up a liability account, then record the amount you got from the loan. The deposit from the bank was a NET amount (example $900.00) entered as a DEBIT. Known as the Economic Injury Disaster Loan, the EIDL is the most commonly taken SBA loan. I don't see any reason to book it as a loan unless you know the client is planning to accept more funds from the SBA in the future. Take care always and have a good one. 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