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PPP Forgiveness and 1040 Form 7203 (Shareholder Basis)

Forum|Forum|4 years ago
March 31, 2022
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My Schedule K-1 shows the forgiven PPP Loan amount in space 16B of "Other Tax Exempt Income". everything I have read states that it does affect your shareholder stock basis. The new Form 7203 has a space for K-1,line 16A but NOT for line 16B. How do I record this?

Best answer by cschaffer

Thank you for responding to my question. I see my form states to place amount from Box 16 A on line 3k. I appreciate your clarification.

Employee

Enter the total of Schedule K-1 Line 16 A and B in Form 7203 Line 3k.

According to the IRS Instructions for Form 7203 Line 3k:

"Enter the sum of the amounts from Schedule K-1 (Form 1120-S), box 16, codes A and B."

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cschafferAuthorAnswer

Thank you for responding to my question. I see my form states to place amount from Box 16 A on line 3k. I appreciate your clarification.