We own a country inn. For over 20 years, I've used an Equity 'draw' account to keep track of cash paid in and paid out of our S-corp. (We handle very little cash--almost all credit card receipts.) We also have a sister LLC, which owns our land and buildings, which does not maintain a checking account, so we've paid tax bills, etc. from the main S-corp account through a draw, and we record a rent payment there, as well. Historically, I've shown the balance of the draw accounts as a distribution at the end of the year, and have closed them to Retained Earnings on 1/1 of the next year. However, for the past few years, our distributions have gone negative. Up until this year, I've been able to show a negative distribution on our tax return, and all has been well. This year, ProSeries isn't allowing me to show a negative distribution. How should I handle this?
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Sorry! My original question apparently delved a little too deeply into my personal problem. My Tax Question is: has there been a change in tax law that now will not allow a negative distribution to be entered on the M-2 Schedule, line 7? And if so, does ProSeries have any instruction on the matter?