Good day,
I am closing a small S-Corp, and I am having problems understanding how the final Balance Sheet should appear. I understand that the overall Total Assets and Total Liabilities/Equity should each equal zero, but I am not sure about some of the internal lines, particularly those in the Liabilities section. The Asset section already has zeros for all of its rows. I would really appreciate any insight. Thank you very much.
The current values for the Liabilities/Equity section are roughly:
- Loans from Shareholders = $75,000
- Capital Stock = $1,000
- Additional Paid-in-Capital = $40,000
- Retained Earnings = ($116,000)
Is it appropriate for a final tax return's balance sheet to still contain these values, or should one or all be made $0?
What about when shareholders are given any remaining tangible assets as "payment in full for the exchange of their stock" but whose FMV won't even come close to totaling the loans given over the years by the shareholders?
