I experienced this exact situation with my 2018 1120-S return. I unknowingly made distributions to two shareholders that exceeded line 6 of Sch M-2. The program then listed my distributions as the line 6 value, instead of my actual distribution total, giving me a zero AAA balance.
1. Even though the balance is listed as zero, does the program secretly carry forward a negative balance to use for the next year's M-2 calculation? My 2019 M-2 showed a starting balance of zero, not negative.
So I have another question/problem. My 2019 Sch M-2 was filled out by TurboTax Business and showed an AAA balance at the end of the year. However, my 2020 Sch M-2 and My 2021 Sch M-2 are completely blank. TurboTax Business did not carry any information forward from 2019 and basically failed to complete these M-2 schedules.
2. Why would this have happened? Can I force TurboTax to fix this? Can I manually correct these M-2 forms for the last two years?
Thanks!
