Very helpful, I think this makes sense now: regarding your point 4, my understanding is that my basis (contribution of property and cash less debt) is actually my contributed capital from personal funds to the business essentially, not customer funds paid to me or inventory purchased before the S corp or during the S corp's existence (I have no debt). It is the contribution of my personal funds to the business and not the contribution of the LLC's assets/liabilities to the S Corporation that determines my shareholder basis.
From the start I have been on accrual basis so deferred revenue is cash received but not recognized because the order was not yet delivered. Regarding the 357(c), most examples talk about putting assets with a debt component tied to the asset like a mortgage. So if my firm's assets (cash+adj. basis of inventory) exceed liabilities (not counting deferred revenue, I just have a small accounts payable number and no other liabilities) then there should be no recognized gain? Or does deferred revenue count? I have no depreciation of anything so far.
