Distributions in excess of M-2 Accounts

[freshy70]

I am preparing a first year 1120S and the owner took distributions. I get this message "The amount of distributions entered on Schedule K, line 16d is greater than the total net balance available for distribution in all of the Schedule M-2 accounts by $71,594. This amount of excess distributions has reduced the ending balance of Retained Earnings on Schedule L, line 24." and it is a critical diagnostic. So what am I supposed to do? There does not seem to be any way to correct the diagnostic.

[PhoebeRoberts]

Even though it's labeled critical, it's really an informational item. 

[freshy70]

I see. Seems then I can just ignore the diagnostic and file without risk of the return being rejected.

[PhoebeRoberts]

Yeah, most of the critical diagnostics won't cause an e-file to reject (or fail to be transmitted, which is worse). That one specifically is not a problem for e-file.