Closed company and received final K-1: how to enter distribution in excess of basis

bill334 — Mon, 09 Mar 2026 08:25:26 GMT

shut down S Corp, received final K-1. (not a sale; just shut down the company). I understand that the distribution in excess of basis appears on Form 8949.

Let's say the final K-1 shows:

Distributions: 2500

Stock Basis before Distributions: 500

Gain recognized on excess distributions: 2000

On the Form 8949, should this appear as:

Proceeds: 0

Cost or other basis: -2000

OR, on the Form 8949 should this be:

Proceeds: 2500

Cost or other basis: 500

I understand the tax effect is identical. How should it appear on the form?

Re: Closed company and received final K-1: how to enter distribution in excess of basis

JamesG1 — Thu, 10 Mar 2022 19:58:19 GMT

Report on 8949 in this way.

Proceeds $2,500

Basis $ 500

Gain $2,000

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Closed company and received final K-1: how to enter distribution in excess of basis

Re: Closed company and received final K-1: how to enter distribution in excess of basis