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Level 1
posted Feb 27, 2021 8:30:18 AM

S-Corp has no income. Do I need to issue a Schedule K1

Hi,

 

I have a single member S-corp and I am the 100% owner. It has profits in 2019 due to which it had ~20k cash on its balance sheet.

However, in 2020 the business had 0 revenue, ~$100 in expense and I did not take any salary from it but I transferred $15K from business account which I guess will amount to distribution.

I have a couple of questions:

1) Do I need to file a business return? 

2) Do I need to generate Schedule K1?  if yes, will it impact my personal income taxes or is it mere reporting requirement.

Appreciate your guidance please - Thanks.

 

Thanks,

Nb

0 2 683
2 Replies
Level 15
Feb 27, 2021 8:38:22 AM

As long as your S corporation election is effective you are required to file an 1120-S.

 

See https://www.irs.gov/instructions/i1120s#idm140355079064496

 

Your distributions will flow through to your K-1 (Line 16).

Expert Alumni
Feb 27, 2021 8:47:05 AM

Yes, you need to file Form 1120-S. As @Anonymous_ stated: "As long as your S corporation election is effective you are required to file an 1120-S."

 

From  2020 Instructions for Form 1120-S: 

 

A corporation or other entity must file Form 1120-S if (a) it elected to be an S corporation by filing Form 2553, (b) the IRS accepted the election, and (c) the election remains in effect.