Hello,
I'm receiving a diagnostic related to distributions that my client took in excess of her basis. I understand that this excess distribution needs to be shown on Form 8949 as a capital gain on her personal return. But I'm not sure how to resolve the diagnostic on her 1120S.
The diagnostic is as follows:
"The amount of distributions entered on Schedule K, line 16d is greater than the total net balance available for distribution in all of the Schedule M-2 accounts by $****. This amount of excess distributions has reduced the ending balance of Retained Earnings on Schedule L, line 24."
Can anyone help me with the steps to resolve this?
Thank you!
Best Answer Click here
That diagnostic is informational. Nothing to resolve.
That diagnostic is informational. Nothing to resolve.
Ah, ok. Thank you!
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