1120S Officer equity distributions?

[NewToTaxes]

Hi. I'm doing the 1120s for our corp. Officer / Shareholder / Boss has had lots of personal payments and purchases made on his/her behalf over the year, and the amounts have been flowing to the equity in the books. However, the total amount for the year is substantial. Would this be considered dividends or property distributions or dividend distributions? Should these somehow be included in the boss's K-1? What is the correct way to handle these amounts in the 1120S / K1? Please note that the amounts were never claimed or reported in the 1120S / K1 before, though I suspect that they should have been. Thank you so much!

[TAXNJ]

Since you are in a better position to identify what the “payments/purchases” are, you might consider looking at
TTB tab 19 S Corps that explains the type of classifications you mention.

Also, it’s time to talk to “Boss” whether you should stay in current position.

[NewToTaxes]

Thanks, TaxNJ.

[NewToTaxes]

To clarify, the payments for personal utilities, purchases of personal items, etc. were paid for by the business accounts. They were not incurred on personal accounts to be reimbursed by the business. Then, the amounts were recorded as purchases and payments under the owner's equity. I apologize for any possible confusion. Thanks.

[TAXNJ]

To clarify, the payments for personal utilities, purchases of personal items, etc. were paid for by the business accounts. They were not incurred on personal accounts to be reimbursed by the business. Then, the amounts were recorded as purchases and payments under the owner's equity. I apologize for any possible confusion. Thanks.

Sounds like you have identified issues that may have to be reclassified.

There are many taxpayers who commingle personal and business transactions using the business checking account,
as you know, is wrong.

Good luck