SCorp Final K-1 Loss in Excess of basis

Forum|Forum|2 years ago
September 19, 2023
2 replies
9 views

Can anyone tell me if you can take full loss for a final K-1 from S-corp, it seems to be limiting me to the basis?

Anonymous_

Level 15

Your recognized loss cannot exceed your basis.

Mike9241

Level 15

if it was always an S-Corp and you were the only shareholder from day 1 it is difficult to figure out how you can have a loss in excess of basis. However, there are situations where this can happen such as buying out another shareholder. so, the best I can offer is that any loss in excess of basis is not deductible. you'll be filling out form 7203 (required) with your 1040 so the IRS can check your basis against the loss you take. Unfortunately, the last time I checked the 7203 is only informational for the IRS. it will not limit your loss to basis. about the only way around this is to use the at-risk form 6198

Mike9241