This is my thinking exactly. Since the company had a loss my understanding is that there is no need to run payroll, even though they did pay the owner a small salary (higher than most employees). There was no loan document, so this definitely falls into distributions.

I just had a bright idea of putting it into nondeductible expenses, but I guess from the comments that's not an option.

I guess the business related entertainment (hunting trip with clients) he took could be put into nondeductible expenses because it had a direct business purpose it just isn't allowed anymore under TCJA?