Question 1

Why did I get this 1099-G?

Accepted Answer

According to the IRS, the Louisiana Main Street Recovery Program is required to report to the IRS the amounts paid to individuals and small businesses using form 1099-G. https://www.irs.gov/newsroom/cares-act-coronavirus-relief-fund-frequently-asked-questions The program does not offer legal or tax advice to grant recipients. The 1099-G form is informational. It serves to let you as the recipient of grant money know that the State of Louisiana will report this amount to the I.R.S.

Question 2

Is the grant money I received from the MSRP taxable?

Accepted Answer

Consult your tax advisor regarding your business’s tax obligations concerning this grant. You can also review the Louisiana Department of Revenue's guidance: https://revenue.louisiana.gov/NewsAndPublications/NewsReleaseDetails/12496

Question 3

What should I do if my information (FEIN/SSN, business name, or other information) is showing incorrectly on the 1099-G form)?"

Accepted Answer

If your tax identification number, business name or other information is incorrect on the form 1099-G, contact the MSRP in writing via email with your correct information, including an IRS Form W-9 (signed). That form can be downloaded from https://www.irs.gov/pub/irs-pdf/fw9.pdf. If applicable, the MSRP will issue a corrected 1099-G. Email address: MSRP@treasury.la.gov

Question 4

My business is a corporation that is exempt from 1099s. Why did you send one to my business?

Accepted Answer

Certain corporations may be exempt from 1099 reporting. Additionally, amounts under $600 may also be exempt according to IRS rules on 1099 reporting. However, the Department of Treasury elected to report all amounts issued to all individual applicants (sole proprietors) and to businesses in order to ensure completeness and fairness in reporting.

Question 5

Is the SBA EIDL advance and loan proceeds also going to send a 1099?

Accepted Answer

The Louisiana Department of Treasury cannot advise on the taxability of other government programs.

Question 6

Am I going to get a 1099 for the PPP (Paycheck Protection Program) funds that my business received?

Accepted Answer

The Louisiana Department of Treasury cannot advise on the taxability of other government programs.

Question 7

How can a grant from the state be considered as reportable income to me or my business?

Accepted Answer

Treasurer Schroder has asked this question of many tax experts and government officials since, by law, this was an expense reimbursement program. The IRS instructions on form 1099-G says this: Box 6. Taxable Grants (Excerpt) Report amounts of other taxable grants of $600 or more. State and local grants are ordinarily taxable for federal income purposes. A federal grant is ordinarily taxable unless stated otherwise in the legislation authorizing the grant. The Section 5001 of the Federal CARES Act which funded this program did not specifically exempt grantees from taxation. More information can be found at https://home.treasury.gov/policy-issues/cares/state-and-local-governments

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