First time I have a loss on an 1120S, however, the shareholders do not have any basis anymore. So they should not be able to deduct the loss. I can't seem to find in Proseries where to indicate this?  Does box 1 of the K1 still report a negative number and this gets handled on the 1040?  Or is it done on the 1120s and then box 1 reports $0?

Thanks!