S Corp Stock Sale

[farm girl]

Taxpayer was one of nine shareholders in an S Corp. Someone else acquired the business and purchased all the stock from the nine shareholders in 2006. Taxpayer received a final K-1 with Box 16, Code D amount of 245.

The shareholder basis worksheet shows:
The adjusted basis of the stock before the distribution = 245
Distribution = 245
End of the year stock basis = zero

Do I show the stock sale as:
Sale price = 245
Basis = 0

Never had anyone sell S Corp stock before and I'm feeling incredibly stupid right now - more so than normal.

[veritas]

If the basis worksheet

has been computed correctly the basis is zero. But I would compute my own basis.

[farm girl]

I'm still unsure -

How would you show the stock sale? All she received from the sale was the 245 that recouped the remaining basis in her stock - there was no additional money.

And now, my other question is -
She received a Shareholder's Basis Worksheet Page 1 and Page 2 - looks very much like the ones ProSeries prints out. Do you usually find problems with the calculated basis - is it always necessary compute the basis again?

Oh, yikes!

[rosieea]

Taxpayer was one of nine shareholders in an S Corp. Someone else acquired the business and purchased all the stock from the nine shareholders in 2006. Taxpayer received a final K-1 with Box 16, Code D amount of 245.

The shareholder basis worksheet shows:
The adjusted basis of the stock before the distribution = 245
Distribution = 245
End of the year stock basis = zero

Do I show the stock sale as:
Sale price = 245
Basis = 0

Never had anyone sell S Corp stock before and I'm feeling incredibly stupid right now - more so than normal.

Who purchased the stock? If "someone else" did, then I don't see what the $245 distribution had to do with the purchase. What did the shareholder receive from "someone else?" If the Corporation bought the stock, and the distribution was in exchange for the stock, and was in the amount of the shareholder's basis at the time of the sale, then report on Sch D with proceeds of $245, basis $245, and gain/loss zero.

[farm girl]

The story is ...

Nine people formed an S Corp and each invested an equal amount of cash into it at startup. After 3 or 4 years they decided it was too much of a headache and when a 10th person approached them about buying the corp all nine sold their shares to the 10th. When I asked, "How much did you get from this" she said, "Just over 200 - we were glad to sell the shares and be done with it. We didn't make anything but we didn't lose anything, either."

Her K-1 shows a distribution of 245 and I wasn't sure how to show the sale on Sch D.