I am assuming the 1065 was for a partnership, and not a multi-member LLC. If my assumption is wrong, please let me know.
Overall, I think you may find it better to seek professional help for at least this year for correct reporting/closeout of the 1065 and issuance of final K-1's for that, as well as the transfer of all assets and other stuff to the new S-Corp.
Since 2019 is the first tax year the S_corporation existed, the BOY (Beginning of Year) Inventory Balance must be zero. No exceptions.
Additionally, if 2018 was the last year the multi-member LLC/Partnership existed, the IRS does not consider that 1065 business closed until several conditions are met.
- The EOY (End of Year) Inventory Balance must be ZERO. No exceptions.
- All end of year cash balances must be zero. (no exceptions)
- All assets must be disposed of so the partnership does not own any assets at the end of the year.
- If the partnership claimed any vehicle use (even if less than 100% business use) then disposition of those vehicles must be shown.
For the inventory on the 1120-S, your BOY Inventory Balance *MUST* match y our prior year EOY inventory balance. Since the corporation did not exist on Dec 31 of 2018, there is no way the corporation can have more than a $0 inventory balance on Jan 1 of 2019.
