I have an S Corporation that received a 1099-C for about $500k. We can exclude $200k since their liabilities exceed their assets. How do I reduce the tax attributes of the S corporation?
They have an ordinary loss of $50k in the same year, they have a carryover of disallowed sec. 179 deduction of about $16k, and shareholder has about $80k in suspended losses that were limited by basis.
I am pretty sure all of these tax attributes (total $186) would be reduced to zero since we excluded $200k from the 1099-C. Are they limited at the S corporate level or at the shareholder level? And how would this be entered into Lacerte.
I would appreciate any guidance.
Thank you.
Are there fixed assets?
Are you talking 2022 COD?
I think the reduction in tax attributes takes place 1/1/2023, assuming your S Corp is calendar year.
They only have the $16k in assets at cost. I was estimating the FMV at $10k. The 1099-C is from 2021, we are filing an amended 2021 return. They are calendar year.
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