A member asks: "The IRS has the following FAQ on its website with regard the Coronavirus Relief Fund and whether grants issued use such funds are taxable. Q. If governments use Fund payments as described in the Fund Guidance to establish a grant program to support businesses, would those funds be considered gross income taxable to a business receiving the grant under the Internal Revenue Code (Code)? A. Yes. The receipt of a government grant by a business generally is not excluded from the business's gross income under the Code and therefore is taxable. However, a grant made by the government of a federally recognized Indian tribe to a member to expand an Indian-owned business on or near reservations is excluded from the member's gross income under the general welfare exclusion. We issued grants to various non-profits in our community using Coronavirus Relief Funds. Generally, we do not issue 1099s when providing grants using other funds, but this FAQ does not distinguish between for-profit and non-profit businesses when stating the grants are taxable income Is anyone interpreting the FAQ to mean grants to non-profits using Coronavirus Relief Funds are taxable income? And if so, are you going to issue a 1099 to the recipients? Thanks for the feedback!" Charles W. Thompson, Jr. General Counsel & Executive Director D: 202-742-1016 P: (202) 466-5424 x7110 M: (240)-876-6790 [facebook icon]<https://www.facebook.com/InternationalMunicipalLawyersAssociation/>[twitter icon]<https://twitter.com/imlalegal>[linkedin icon]<https://www.linkedin.com/company/international-municipal-lawyers-association-inc./> [logo]<https://imla.org/> 51 Monroe St. Suite 404 Rockville, MD, 20850 www.imla.org<http://www.imla.org/> Plan Ahead! IMLA's 2021 Mid-Year Seminar<https://imla.org/seminars/>, April 23-26, 2021 in Washington, DC! IMLA's 86th Annual Conference<https://imla.org/annual-conference/>, Sept. 29-Oct. 3, 2021 in Minneapolis, MN!