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When can I take a loss on an S Corp?

joe7230
Level 1

What line on the 1120S should I look at to determine if a loss is deductible?

Is it on Schedule M-2?  Also is an asset purchase considered a capital contribution

to calculate Schedule M-2.  How about an asset fully depreciated in the same year

as purchase?  

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Champion
Champion

1) The basis schedule maintained by the shareholder.

2) No, M-2 does not calculate shareholder basis, other than occasionally coincidentally.

3) No, asset purchases are not shareholder contributions to capital.

4) No, depreciation is not relevant to determining shareholder contributions to capital.

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Champion
Champion

1) The basis schedule maintained by the shareholder.

2) No, M-2 does not calculate shareholder basis, other than occasionally coincidentally.

3) No, asset purchases are not shareholder contributions to capital.

4) No, depreciation is not relevant to determining shareholder contributions to capital.

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abctax55
Level 14

5) Not to be rude, but you are in over your head.  Get professional assistance (if you are a DIYer) or find a mentor (if you are a tax preparer).

** Former AllStar - so don't trust ANY of my answers **


(If a post answers your question, click on "Accept as solution" for future searches)
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IRonMaN
Level 15
Yeah, I was kinda thinking the same thing but I didn't want to appear rude.  Sometimes folks need to stick at what they do well and refer other work elsewhere.  There are certain things that I don't touch and I have no problem telling folks that they need to find someone in those cases.  Nobody can be an expert on everything ------------------- well maybe nobody except Phoebe :wink::wink:
ACME Badge Company - "When you care enough to send the very best"
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