Thank you for your reply, @MinhT1.
I understand that the loan from the shareholder does not affect the profit of the S corp. However, I think your statement that the loan is not reported on the K1 is incorrect as I see TurboTax listing the $500 loan on each shareholder's K1 as "Loans from shareholder. . .End of tax year" on our K1. There is no amount in "Beginning of Tax year" which is what I'm trying to fill out.
I understand that I don't have to fill out the balance sheet but, from all of my reviews, it has been recommended by tax attorneys & other CPA's to fill it out so I've been doing that for my LLC tax return. Where, in Schedule L, would I account for the $1200 that was loaned by the shareholder/members in 2021 & reimbursed to the same shareholders/members in 2022? Since I did account for the loan in my 2021 1065 tax return which does show "$600 nonrecourse loan from shareholder at end of tax year," I want to make sure that the amount is accounted for in my 1120S return so that the IRS doesn't wonder what happened to the loan. Thank you.
