It sounds like you are getting guidance for a non-dividend distribution of in excess of your stock basis, which is taxable as a capital gain. You would need to know your stock basis to know for sure if the entire distribution is taxable. Because your stock was obtained via "options", you would need to know the basis in your stock.
Your basis in the stock depends on your initial basis in your stock, and the activity from your K-1s since that time. See this IRS website for a good overview of your stock (and debt) basis for S Corps.
The initial basis in your stock depends on the value of the stock when you received it, less any amount you had to pay, the net of which should have been reported on your W-2 at that time you actually received the stock.
To report the long-term gain for a distribution in excess of basis (distribution up to your basis is not taxable), click the "magnifying glass Search" icon on the top row, enter "investment sales" in the search window and press return or enter, and then click on the "Jump to investment sales" link. After Yes you sold, and No for 1099-B, choose "Everything Else". Enter a description (e.g., Distribution in Excess of Basis), the amount in excess of your basis, and the date you received the distribution. Your cost basis will be zero for the amount in excess of your basis.
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