How do I know if I have an at-risk carryover loss?

[llamacorn7]

I'm doing my  2017 tax returns and I have an S-corp that had a loss in 2016.  How do I know if I have an at-risk carryover loss?

Do I find this on my Federal Carryover Worksheet? If so, how do I calculate it? 

[VolvoGirl]

Are you preparing the S Corp return?  I ask because you can't use the Home & Business version for an S Corp.  you need the separate Turbo Tax Business program.  But Business is only available for Windows not Mac.

[Rick19744]

A couple of things here:

1. Are you tracking your basis?
2. When you prepared your 2016 individual tax return, did you take the loss.  This, of course, will depend on whether you had sufficient basis to take the loss
3. So depending on the responses to the above questions, this will determine whether or not you have any loss carryover to 2017.

[llamacorn7]

Thanks for your quick response @VolvoGirl ! I'm preparing my personal tax return and have a K-1 for my S-corp

[llamacorn7]

@Rick19744  Yes, I took the loss in 2016, but wondered if there was a limit per year. If there's a carryover loss, where would it show on my 2016 tax return?

I forgot to mention, it's a single-member LLC taxed as an S-corp, and I put a 100% into the company.

[Rick19744]

A couple of follow-up comments:

1. Based on what you are saying, it doesn't sound like you have any carryover to 2017.  TT would not have limited the loss unless you had indicated that you were passive or were limited in basis.
2. Having said that, it is extremely important that you track your basis in the S corp stock.  This begins with your initial capital contribution and is adjusted annually for the applicable lines on your K-1.  See the attached link from the 2018 S corp K-1 instructions page 4 on updating your basis:

https://www.irs.gov/pub/irs-pdf/i1120ssk.pdf

Unless you properly maintain your basis, you will not know if you are able to take losses, if distributions are tax-free or taxable, or determine your gain or loss upon the sale or liquidation of your stock.