How can I enter in QB a loan used to buy back Corporate Shares and the resulting distribution to the shareholder cash in excess of his capital account?

[kbutler]

how do I enter a loan used to buy back corporation shares for more than the amount in the capital account

such as 180000 added to cash           ( 180000  ) loans due greater than one year

distributions 180000                          (51000)    capital account

                                                           (129000)  ????

[qbteachmt · Accepted solution]

For the accounting and tax treatment, they didn't seem to know what this would be treated as. It's two reductions in Equity, so I gave the steps in QB-ese for how to do it, because I knew that answer.

For the QB part, the QB Community is at this other link:

https://quickbooks.intuit.com/community

[qbteachmt]

"Such as added to cash" = Banking menu > Make Deposit. The "from" account is Long term Liability.

The "distribution" is Banking menu > Write Check. On the Expenses tab, you put the Splits. Distribution from equity is one line. Treasury stock equity account is the second line. Now you have the total of the Check = the amount spent.

[sjrcpa]

Treasury stock

[abctax55]

Methinks this is a QB question, not a tax question.

FWIW tho...distributions > basis result in capital gains.

AND, uneven distributions may void the S-election.

NMI?