Scorp XS Distributions

[dsi]

My s-corp SH took excess distributions in the amount of $1500. Lacerte is giving me a "critical" diagnostic warning indicating that this is more than the total net balance available for distribution in all fo the Sch M-2 accounts.

What do you do with this? I've always picked this up on the SH's personal return as a "disposal" (sale of stock).

[JohnH]

Are there any shareholder loans on the books? You might be able to do something there. If you have multiple shareholders, the excess distributions could cause several problems if not handled carefully.

[dsi]

Are there any shareholder loans on the books? You might be able to do something there. If you have multiple shareholders, the excess distributions could cause several problems if not handled carefully.

only 1 SH, and no loans on the books!

[veritas]

Lacerte

My s-corp SH took excess distributions in the amount of $1500. Lacerte is giving me a "critical" diagnostic warning indicating that this is more than the total net balance available for distribution in all fo the Sch M-2 accounts.

What do you do with this? I've always picked this up on the SH's personal return as a "disposal" (sale of stock).

has a basis worksheet (make sure it is correct). The distributions may or may may not be taxable depending whether the distributions exceed the shareholders basis.