S Corp started on 01/01/2018 with 2 shareholders. In March one withdrew 100% of his investment. S corp dissolved on 03/31/2018. How Can I prepare Schedule K-1? One? Two?

Forum|Forum|6 years ago
December 7, 2019
5 replies
38 views

I have a S Corp client with two shareholders. The business started on 01/01/2018. In March one of the shareholder became severely ill and withdrew entirely 100% of his investment. They dissolved their S Corp on 03/31/2018. The other shareholder accepted all net operating loss in 2018. How can we handle their Schedule K-1? Can I prepare only one Schedule K-1 for the shareholder with NOL?

Thank you.

Tao Phan

ProSeries Professional

This topic has been closed for replies.

Best answer by TaxGuyBill

Um, one shareholder can't just "accept" the loss. The loss is divided between them based on their ownership (with two K-1s).

If the corporation was dissolved and completely ended in March 2018, do you realize the tax return is now quite late (with penalties)?

T

TaxGuyBillAnswer

Um, one shareholder can't just "accept" the loss. The loss is divided between them based on their ownership (with two K-1s).

If the corporation was dissolved and completely ended in March 2018, do you realize the tax return is now quite late (with penalties)?

T

TDPhanAuthor

Level 2

Thank you so much. But what about the first one who was severely ill, and withdrew his entirely 100% of his investment before dissolution (assumed each invested $100,000 and first one withdrew his $100,00 and the S Corp lost $10,000) ? I just try to help my client a proper and lawful way in compliance with tax law and rule. I never had this situation before. Thank again.

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