If subsantial you can do a deduction on your 3RD quarter payroll. ( You mean deduction for what? Payroll or distribution) He did not have payroll as of Jan till now but taken continuously distribution around $95000. We have to increase payroll? right?

-in essence credting S Corp Distribution as part of your payroll entry. ( I need a little more explanation)

Thank but did not understand could please explain it more.