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S Corporation shareholder basis limitation

RJGCPA
Level 2

Taxpayer has no remaining basis in S Corp investment. Current year loss reported on K-1 carries to form 8582 and a portion gets allowed (other investments on form 8582 mix of loss and income). If I try a form 6198 (which is incorrect becase he is at risk) I can get the loss disallowed but still it gets carried to the form 8582 and because of other investments a portion gets allowed. Once a portion is  allowed on form 8582 it gets  carried to schedule E-2 and allowed as a deduction. If I eliminate the loss on K-1 

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4 Comments 4
sjrcpa
Level 15

Since your software does not apply the basis limitation, you will need to do it manually.

Enter only the amount of loss, if any, allowed by the basis limit.

Track the loss in excess of basis outside of the software for future years.


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TaxGuyBill
Level 15

@sjrcpa  I think you know more about how ProSeries works than many people who actually use ProSeries.  😂

sjrcpa
Level 15

Tells you that I spend too much time here.


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abctax55
Level 15

Susan... many PS users would beg to differ with that 😉

"*******Tax software is no substitute for a professional tax preparer*******
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