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Dividend Distributions to Shareholders from accumulated earnings and profits account

Plarka — Tue, 28 Jan 2025 20:47:23 GMT

I file as an S Corp and am the only employee. Does this question just mean what are my profits above my salary?

Re: Dividend Distributions to Shareholders from accumulated earnings and profits account

DavidD66 — Tue, 28 Jan 2025 21:37:10 GMT

No. You should probably enter $0.00. Dividend Distributions to Shareholders from accumulated earnings and profits are dividends paid to S-Corp Shareholders and reported on Form 1099-DIV. It is highly unlikely your S-Corp paid such dividends. If your S-Corp made a profit, those profits are your retained earnings. When you take a money out of your S-Corp (non-payroll) those payments are distributions and come out of your retained earnings. Essentially, you are taking the profits out which either have been or will be reported on your K-1 and taxed on your personal tax return. Those distributions are reported on Schedule K, line 16d of your Form 1120-S. They will also appear on 16D of your Form K-1.

Re: Dividend Distributions to Shareholders from accumulated earnings and profits account

Plarka — Sat, 01 Feb 2025 21:27:33 GMT

I did take all the money through the year and put it in a personal savings. Does that change your answer?

I know I shouldn't have, and I now have a business savings account where I'll put my money earned this year going forward. I'm not sure how that changes things, but at least it's better organized and straight forward which is personal and which is business.

Re: Dividend Distributions to Shareholders from accumulated earnings and profits account

Plarka — Sat, 01 Feb 2025 21:30:07 GMT

I just thought of something. What if I move the money from my personal to my business savings? Would that help? Then can I definitely say zero? Or can you not take out and put back in?