@qbteachmt thank you. this is very helpful. if Father would have sold 49% of his shares to his Son or a third party for FMV of $30K per share, what would his capital gain have been and where would he report it ? i would need to know his basis in the company. would it be 49% of his original $1 per share Capital Stock plus all income/losses minus distributions? at the end of 2017 his basis according to books and K-1's was only $10K.  
so would this math be correct:
sale price (49 X $30,000)=$1,470,000
Basis $10,000
Gain $1,470,000 - ($49 capital stock + 0.49 * $10,000 profits less distributions) = $1,465,051?

What would Son's basis be in a year or two should he decide to sell his shares? say S corp had profits of $100,000 both years and Son didnt take distributions. would this be correct math?
Sales price (49 X $30,000) = $1,470,000
Basis $10 what he paid to his Father for a gift +$4,900 assumed Father's basis + 2 x $49,000 2 years of S corp profits = $102,910
Gain $1,470,000- $102,910 = $1,367,090

where do you guys learn all this? it was not in any of my textbooks...