I am the sole shareholder of Sub S corporation which I dissolved in 2024. Over the years, I loaned the company money, with a balance of $55k at the end of 2023, with stockholder equity of $28k, reflecting depreciation recapture when the properties were sold. The properties were acquired and renovated in 2006 and 2008. They were held as rentals as the market "collapsed". Over the 15 years, values recovered enough to cover outstanding mortgages, but the properties sold for less than the land and building cost-basis, when placed in service.
The final return completed by my accountant continues to show an outstanding loan balance on the final return, but does not reflect the stockholder equity. The IRS requires final returns to be submitted 4 months after dissolution, so 2023 forms were used, noting that the return was "final". It was submitted in November of 2024.
Does the return need to be amended to zero the balance sheet on the final return? If so, can I do the amendment using 2024 forms?
My account told me I could make adjustments at the 1040 level using form 7203 and Schedule D. How do I amend, or should I amend? I don't want to open up a can of worms. When I look at Form 7203, I can't use the figures from the final return, as neither the retained earnings nor the loans are zeroed out on the final return. The only undepreciated property left is a phone that had a 1231 depreciation charge of $83. Operating loss for the final tax year was $900, reflecting accounting fees and other minor expenses.
