allocation percentage

[vivianoliver]

We sold our S-Corp in 2025.  I have entered the sales information from the 1120S forms.  This needs to be allocated 50%, but I don't see where to add the allocation percentage, so I am being charged for the entire profit.  Can you please tell me where to add the allocation, or should I just divide the sale in half?

[Mike9241]

the k-1s would only reflect sales information if the S-corp sold its assets rather than the stockholders selling their stock. So please describe in more detail what happened. There's always the possibility that the k-1 is wrong. 

[vivianoliver]

There was nothing on the K1 regarding the sale of the stock.  The stockholders sold their stock.  When I enter the sale numbers, because there were two stockholders, shouldn't this be split?  There is no way that one stockholder should pay capital gains on the entire sale.  

[AmeliesUncle]

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@vivianoliver wrote:

There was nothing on the K1 regarding the sale of the stock.  The stockholders sold their stock.  When I enter the sale numbers, because there were two stockholders, shouldn't this be split?  

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If you sold the stock of the corporation, you only enter what YOU sold your stock for.  You don't enter what somebody else received for selling their stock.

Does that answer your question?  If not, maybe you can clarify things.  The corporation itself (the stock) was sold, right?  The corporation didn't merely sell its assets, right?

[vivianoliver]

When I enter the sale of the company (stockholders shares, cost of sale, depreciation, and adjusted basis) it gives me all the income, not half.  I don't know where to put the my percentage.

[vivianoliver]

They sold everything.  I don't think there were any assets other than their customers, so the only thing to sell was the stock.

[AmeliesUncle]

I don't quite understand the situation.

Are you preparing the corporate return or your personal Form 1040?

If the corporation sold its assets, you enter the sale of each asset on the corporate return.  After you enter all of that, the corporation should split the income/loss to each member of the corporation and each member's share will be on their K-1

If you sold the stock of the corporation, that is not entered on the corporate return at all.   You just enter the sale of stock on your personal Form 1040.  There is no depreciation or anything else - just your Basis in your stock and the price your stock was sold for.