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Returning Member
posted Mar 20, 2025 8:12:40 AM

When liquidating my SCorp with 0 gain/loss, on form 7203 do I include liquidating distributions thus showing the basis of 0 end of year,?

- My liquidating distributions exactly matched my initial paid in capital (net 0). - I filed a 1099-DIV with line 9 populated - I also included the total distributions on the K-1.

0 4 1214
4 Replies
Expert Alumni
Mar 20, 2025 9:33:51 AM

Yes, you should include your liquidating distribution on Form 7203.  

Returning Member
Mar 20, 2025 9:55:40 AM

So in that case, my final basis goes to 0 on 7203 form ?

Returning Member
Mar 20, 2025 11:19:50 AM

Thanks David. Does that mean my form 7203 will show a final basis of 0 for the SCORP ? 

 

How does that reconcile to the Schedule D where I am supposed to show the "sale" price and the original basis for my SCORP - i have a $260 regular distriibution and then a $6905 liquidating distribution. My original basis was 6905.

Expert Alumni
Mar 25, 2025 7:46:00 AM

Yes, Form 7203 should have an ending basis of zero for a liquidated S-Corp.

 

The "sale" on Schedule D would report no gain or loss if the liquidating distribution was equal to your basis in the S-Corp.