My single-member S-Corp has a 1120s tax return loss of (-$36,000). The S-Corp received $29,925 in forgiven tax-exempt PPP money, which made the adjusted book loss (-$6,568). The stock basis at the beginning of the year was $8,987, with a debt basis of $0. The stock basis at the end of the year was $2,419 with a debt basis of $0. In the personal income section of Form 1040, it says to enter Ordinary Income or Loss from Schedule K-1, Box 1 that is ($-36,493). The K-1 Box 16 contains items affecting shareholder basis: Code B- other tax-exempt income $29,925. The instructions say not to enter a loss greater than the basis. What should be entered as the loss?
