There are a number of unknowns here:
- There is no mention of whether you have a net positive or net negative adjustment
- I will also assume that there is no E&P
- Distributions cannot cause the AAA to go negative, so it is possible that Sch K and Sch M-2 distribution amount are not the same
- The ordering rules, which are impacted by bullet #1, are meant to allow the S corporation to make distributions that are not taxable to the extent of previously taxed income (which is what AAA tracks). The OAA tracks nontaxable income and expenses associated with nontaxable income.
- However, nontaxable income does impact shareholder basis, so even though distributions may be limited by AAA, the distribution may still be tax-free as a result of contributions and nontaxable income.
- The only reason to have any distribution reflected in the OAA column is to show sourcing of the distribution.
- Since I am not on a Windows environment, I can't provide assistance on how to get TT to handle this other than you will most likely have to use a forms mode, override and paper file the tax return.
- You may want to call TT to ask for assistance with the input, but they will need to know some of the missing facts as noted above.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
