My Pennsylvania-based startup Limited Liability Company (taxed as a partnership) received a grant from an economic development group in 2008. This economic development group gives grants to startup businesses using state funds.
My company ended the year with much of this grant money still in the bank and did not have enough expenses to offset this. The money is budgeted to be fully spent by June 30, 2009 and is even required by contract to be spent by then.
Will this remaining money be taxed as income even though it is a grant that will be fully spent by June 30, 2009?
Don't know the laws of PA - might want to start at your Secretary of States office or local IRS office and ask that questions. or, try :
http://www.irs.gov/businesses/partnerships/index.html
Best bet is to talk with a CPA who understands both your siotuation and how economic development money is handled in your state.
phanio | Contributor | 4/3/2009 - 4:57 pm
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