Details of Public Law 117-2, section 5002 , Targeted EIDL Advance

California conforms to IRC section 61, as of the specified date of 1/1/2015, with modifications.

For taxable years beginning on or after 1/1/2019, California amended sections 17131.8 and 24308.6 (AB 1577 Stats. 2020 Ch. 39 and AB 80 Stats. 2021 Ch. 17) to conform to the CARES Act and the CAA relating to:

Exclusions from gross income for PPP loan forgiveness and certain EIDL loan forgiveness,

The allowance of deductions for expenses paid with the forgiven loan amounts not included in income under such sections, and

Allowing tax basis increases and not requiring tax attribute reduction as a result of those forgiven loan amounts being excluded from gross income.

Taxpayers with loans forgiven under the Economic Injury Disaster Loan (EIDL) Grant or Targeted EIDL Advance, are not required to meet these qualifications to deduct expenses.