S corporation shareholders use Form 7203 to figure the potential limitations of their share of the S corporation’s deductions, credits, and other items that can be deducted on their individual returns.
Form 7203 appears in the S-corps, Partnerships, and Trusts Income from partnerships, S-corps, LLCs and REMICs near the end where you entered Schedule K-1.
If you’re an S corporation shareholder and you:
- are deducting an S-Corp loss (including a prior year loss disallowed due to basis limitations)
- received a non-dividend distribution from an S-Corp
- disposed of S-Corp stock (regardless of whether a gain was recognized)
- received a loan repayment from an S-Corp
TurboTax will create Form 7203 on your personal return and perform limited calculations based on your entries.
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