I was 25% owner of an S-Corp which was dissolved in 2019. In 2014, we had hired a lawyer and paid a retainer of $3000. The company filed a final tax return for 2019 which indicates that all cash and securities had been distributed to the shareholders. Per the return, assets are listed at the start of 2019 and none remained at the end of 2019. There was no mention of the retainer (as an asset) in the return, so I have to assume it had at some point been treated as an expense. Possibly relevant, is that each shareholder had a Total Qualified Business Loss carryover; and an NJ-BUS-2 carryover.
In 2022, the law firm discovered the s-corp still had a credit in the amount of the retainer, and sent each share holder a proportionate share of the retainer. I got a check for $750.
I would expect that this should be entered on Schedule C, and would be offset by the loss carryover on Schedule C (Form 8995-A). However, I am retired, and have no employment or business activities, so I'm not sure I can call this 'Qualified business income.' Further, TurboTax doesn't seem to use the loss carryover to reduce the current income; wants to charge self-employment tax; and doesn't fill the above form automatically.
How should I properly deal with the $750 on my 2022 return?
