Skip to content

[Best Tutorial] How to Record PPP Loan Forgiveness in QuickBooks?

PPP loan funds

Covid-19 created a lot of uncertainty and financial crisis for multiple small businesses. In order to protect them, the government introduced the Paycheck Protection Program. It was introduced under the Coronavirus Response and Relief Supplemental Appropriation Act of 2021 and was meant to provide small businesses with funds to pay the payrolls for up to 8 weeks. Those funds could also be used to pay interests on mortgages, rent and utilities by the businesses. While the scheme ended on May 31, 2021, existing borrowers are still eligible for PPP. These were the lendings by the government and while businesses were expected to return them, a lot of them applied for loan forgiveness which was approved. This article will discuss how you can record PPP loan forgiveness in QuickBooks desktop.   

Wondering how to record PPP loan forgiveness in QuickBooks? Just call an expert at +1-(855)-955-1942 and they will guide you about the whole process. 

Banks offering Paycheck Protection Program (PPP) loans through QuickBooks 

Intuit Financing Inc (d/b/a QuickBooks Capital) has been authorized as SBA Paycheck Protection Program lender. There are also other banks under Paycheck Protection Program(PPP) that offers loan within QuickBooks that the application directly deals with:- 

  • Intuit Financing Inc (Subsidiary of Intuit Inc)
  • Cross River Bank
  • New Jersey State Chartered Commercial Bank
  • Member FDIC

NOTE: The minimum loan amount that the borrowers could receive depends on the state they are living in. 

Users are required to create a journal entry to record PPP loan forgiveness as an income. User should record it in a way that QB knows it is a non-taxable income:- 

  • Go to the Company drop-down menu and select Make Journal Entry. 
  • A new screen will appear, enter in the date and entry number. 
  • Go to Account and search PPP loan, the account should come up in which you credited your PPP loan balance, select it. 
  • Now debit the amount of loan that has been forgiven.
  • Now go to the next row of the account column, tap on it and select Add New.
  • Set this account as Other Income.
  • Give a name to this account such as “non taxable PPP forgiveness”.
  • Hit Save and Close.  

The Journal entry should balance itself. It is very important that the person preparing your tax return knows that it is non-taxable income and separates this entry from the rest. 

Thanks for stopping by! So this has been all about how to record PPP Loan Forgiveness in QuickBooks. If you still have any doubts, reach out to our experts at QuickBooks Data Service Solutions Helpline Number +1-(855)-955-1942 and they will help you out.

Leave a Reply

Your email address will not be published.

nv-author-image

Lily Evans

Lily Evans is a Certified Accountant with Expertise in QuickBooks, Sage and Quicken Accounting Software. Lily has been working with Data Service Solutions for the last 3 years as a QuickBooks Expert and is Helping Accounting software users with their day to day accounting tasks and issues.

© Dataservicesolutions - All Rights Reserved

Disclaimer

"Data Service Solutions" is a Accounting and Bookkeeping service provider. We are distinguished by the virtue of our expertise in various products developed by a wide range of third-party companies. The use of any third-party trademarks, logos, or brand names on our website or other platforms is for informational purpose only. It does not imply any endorsement by Data Service Solutions or vice-versa or that the trademark owner has authorized or collaborated with Data Service Solutions to promote their products and services.

Data Service Solutions does not have any affiliation from any third-party companies, unless any such relationship is explicitly specified. We have no link or affiliation with any of the brand or third-party company as we independently offer support service for all the product errors you face while using different accounting software.

For detailed information on permitted use and specific warranties associated with the software or its peripherals, please contact the concerned third-party directly. Any content accessed, downloaded, or otherwise obtained from or through the use of the website should be at your own discretion.

Intuit and QuickBooks are trademarks and service marks of Intuit Inc., registered in the United States and other countries. It’s Completely Your Choice to Purchase Your Product Directly from Intuit® And Contact Intuit® Directly for Support. Intuit®, The Intuit® Logo, QuickBooks®, TurboTax®, Quicken® Are Registered Trademarks of Intuit Inc. Data Service Solutions Is an Independent from Intuit Inc. Intuit®, QuickBooks®, TurboTax®, Quicken® Among Others, Are the Registered Logos, Trademarks and Brand Names of Intuit Inc. And Are Used Here Solely for The Purpose of Reference.