The gift is FMV less $10. Son's initial basis in the syock is $10 + 49% of father's basis.

In the S Corp, enter the change of ownership -dates and percents so the K-1s show income/loss on a per share per day basis. Read the gift tax return instructions - you'll probably be attaching the valuation report.

On the Balance Sheet there is only 1 equity account.

Too late for 83(b) election and probably not applicable. Below market transfers between family members reek of gift..

Son has no reporting due to acquiring shares.