S-corporation shareholder stock basis at beginning of year

[nmms]

For a taxpayer with a Schedule K-1 (Form 1120-S), how do I determine the shareholder's stock basis at the beginning of the year when it is not given on the Schedule K-1?

[abctax55]

Ask the preparer of the S-Corp return.

Ask your client.

Recreate the info from looking at all years that the K-1 has been provided (that ownership has existed.

Bonus - determine if there's any 'outside' basis.

[nmms]

Tax year 2021 is the first year the company is an S-Corporation. It was a Partnership from tax years 2018 through 2020. The Schedule K-1 (Form 1065) provided a Basis Worksheet that was not included with the Schedule K-1 (Form 1120-S).

[sjrcpa]

Then you have a starting basis for the S Corp .

Neither an S Corp or a partnership is required to provide basis schedules to the shareholders/partners although many do.

It is the responsibility of the shareholder/partner to keep track of their basis. Usually that means the tax return preparer does it.

EDIT: Remember that the shareholder won't get basis for liabilities so remove those to the extent included in the ending partnership basis schedule.

[nmms]

sjrcpa or abctax55

The first photo below is the amount ($69,387) the preparer of the S-Corporation return gave the shareholder for the shareholder stock basis at the beginning of the year 2021. The second photo is the2020 Schedule K-1 (Form 1065) and the third photo is the 2020 Schedule K-1 Partner's Basis Worksheet.

Do you know why the shareholder's stock basis at the beginning of the year 2021 would be $16,990 more than the partner's basis at the end of the year 2020?

[sjrcpa]

No. Only the prior preparer can answer that.