topic Re: Shareholder's Basis Computation Worksheet in Business & farm

Shareholder's Basis Computation Worksheet

PTGeek — Mon, 09 Mar 2026 04:25:18 GMT

I have read some other threads on Shareholder Basis and have a follow up question.

I understand that TurboTax does not have a way to file the basis worksheet electronically (ridiculous by the way). So according to form 7203 under "who must file" you only need to file this worksheet under certain circumstances. Under "TIP" they recommend using it to maintain basis info.

So if I am understanding this correctly, I am filing my K-1 (form 1120s) electronically and hanging on to my 7203 for my records and future basis calculation???

Re: Shareholder's Basis Computation Worksheet

Anonymous_ — Tue, 25 Jan 2022 01:49:07 GMT

@PTGeek wrote:
So if I am understanding this correctly, I am filing my K-1 (form 1120s) electronically and hanging on to my 7203 for my records and future basis calculation???

Retain your K-1 (1120-S) for your records. You do not file your K-1 with your 1040 unless backup withholding is reported in box 13 using code O.

Form 7203 is new and you also do not file it with your return except under certain circumstances.

See https://www.irs.gov/pub/irs-dft/i7203--dft.pdf

Re: Shareholder's Basis Computation Worksheet

ThomasM125 — Tue, 25 Jan 2022 01:52:19 GMT

You are correct. The IRS does not track your basis in your S corporation investment, but you need to do so as you will need to report it when you dispose of your interest in the investment. It is also needed to determine if distributions are taxable or losses are deductible in many instances.

Re: Shareholder's Basis Computation Worksheet

Mike9241 — Tue, 25 Jan 2022 01:59:49 GMT

this form may need to be filed with your return. it has an attachment sequence which means it must be included with your return if you meet any of the criteria for filing it. here's are the filing instructions

Who Must File
Form 7203 is filed by S corporation shareholders who:
• Are claiming a deduction for their share of an aggregate loss from an S corporation (including an aggregate
loss not allowed last year because of basis limitations),
• Received a non-dividend distribution from an S corporation - an amount in box 16 with code D.
• Disposed of stock in an S corporation (whether or not gain is recognized), or
• Received a loan repayment from an S corporation - an amount in box 16 code E

Re: Shareholder's Basis Computation Worksheet

AmeliesUncle — Tue, 25 Jan 2022 04:24:52 GMT

In MOST cases it needs to be filed with your tax return (most shareholders receive a Distribution, and those who don't receive a Distribution usually don't because the business is running at a loss, which also usually requires the form).

But in the event you are not required to file it, yes, just keep track of your Basis for when you ARE required to file it.

Re: Shareholder's Basis Computation Worksheet

PTGeek — Tue, 25 Jan 2022 13:05:16 GMT

I did take a cash distribution but that does not seem to be one of the "who must file" criteria?

This is confusing to me because if you read the responses to my question, most say the 7203 is for my records but one person says I need to file it.... taxes should not be this confusing 🙂

Not sure if the cash distribution changes the answer?

TIA

Re: Shareholder's Basis Computation Worksheet

Anonymous_ — Tue, 25 Jan 2022 14:47:02 GMT

@PTGeek wrote:

I did take a cash distribution but that does not seem to be one of the "who must file" criteria?

Distributions for an S corporation would be dividend distributions if the distribution was from accumulated E&P and the only way your corporation would have those would be if it was formerly a C corporation.

Otherwise, S corporation distributions are non-dividend distributions.

Re: Shareholder's Basis Computation Worksheet

PTGeek — Tue, 25 Jan 2022 15:04:31 GMT

ok.

so that means I took a non-dividend distribution and now I MUST file the 7203.

Still insane that TutboTax does not include this on the s corp online filing.

thanks for the clarification

Re: Shareholder's Basis Computation Worksheet

Anonymous_ — Tue, 25 Jan 2022 15:20:33 GMT

@PTGeek wrote:
Still insane that TutboTax does not include this on the s corp online filing.

The form is not (yet) available in their professional software either.

Re: Shareholder's Basis Computation Worksheet

Rick19744 — Tue, 25 Jan 2022 16:04:45 GMT

Requiring this information is not new.

Before this form was developed, S corporation shareholder's were required to file this same information with their 1040, except, there was no specific form. See snippet from the Schedule E instructions:

Owners of S corporation stock and debt. If you report a loss, receive a distribution, dispose of stock, or receive a loan repayment from an S corporation, you must check the box in column (e) on line 28 and attach the required basis computation.

And if I'm not mistaken, TT did not have any way of attaching this information in the past.

Given this is now an actual form, I would imagine that TT will eventually provide this form. We also have to keep in mind that this form 7203 is brand new and still in draft form. The IRS may not even be set up to accept electronic filing of this form; this is an assumption, but given their staffing situation and that this is brand new, not a huge stretch.

Re: Shareholder's Basis Computation Worksheet

lmr57 — Thu, 17 Feb 2022 20:38:33 GMT

So if TT Home and Business does not have form 7203 S Corporation Shareholder Stock and Debt Basis Limitations Available for completing or listed as a drop down form to complete and I received non-dividend distributions from my S-Corp listed on my K-1, does that mean that I can not use TT to e-file this year? I don't want to file without the form if it is required but it is not even listed on the available forms now. Is there a plan at TT to add this - do I hold my return? Thanks. The program did not even ask me any questions about basis or distributions other than when I put in my K-1 information.

Re: Shareholder's Basis Computation Worksheet

Anonymous_ — Thu, 17 Feb 2022 20:48:31 GMT

@lmr57

Is that form still not in draft mode? I believe it is.

Re: Shareholder's Basis Computation Worksheet

lmr57 — Thu, 17 Feb 2022 21:22:52 GMT

I believe it has been finalized.

Re: Shareholder's Basis Computation Worksheet

Anonymous_ — Thu, 17 Feb 2022 22:26:37 GMT

I believe you are correct.

However, since it appears it was finalized in December, the form still has to be approved for use in the program.

Re: Shareholder's Basis Computation Worksheet

Anonymous_ — Thu, 17 Feb 2022 23:17:34 GMT

The forms availability list indicates Form 7203 will be available on 3/31/2022. Print only.

Addl info on 1120-S?

PTGeek — Thu, 24 Feb 2022 12:21:09 GMT

follow up questions regarding forms to complete for s corp

I had my accountant do my taxes last year and upon reviewing the docs sent in, my accountant also included a completed section L on form 1120-S (Balance sheet). It that required. TT does not ask any specific questions that auto populated the fields.

TIA for your help.

Re: Addl info on 1120-S?

PatriciaV — Thu, 24 Feb 2022 13:53:21 GMT

Yes, Schedule L should automatically appear if the information was displayed on the prior year return. If this is not what you are experiencing, please check the following:

Option 1:

Open your return in TurboTax Business and go to Forms Mode from the TurboTax header.
Click on Form 1120S p1-2 in the left column to open the form in the main window.
Scroll down to Schedule B, Line 11.
If this line is marked "Yes," Schedule L will not be included. However, if you check "No", Schedule L will be included.

Option 2:

Open your return and go to Federal Taxes >> Balance Sheet
Are your Total End-of-Year Assets less than $250,000?
If this is true, and your total income is less than $250,000, when you click Continue, the next page "Good News" will automatically check the box for "Yes, I want to skip this balance sheet section."
Instead, click "No, I want to complete my balance sheet." This will force the program to complete Schedule L. You will also need to enter your balance sheet info, and it must balance. (See How do I reconcile my balance sheet in TurboTax?)

Re: Addl info on 1120-S?

PTGeek — Thu, 24 Feb 2022 13:57:40 GMT

my 1120 s does not show a line 11 in the "Forms" view of TT. It starts with line 12

If end of year assets are < 1 million then I do not need to complete the balance sheet???

Re: Addl info on 1120-S?

Anonymous_ — Thu, 24 Feb 2022 14:26:52 GMT

@PTGeek wrote:

my 1120 s does not show a line 11 in the "Forms" view of TT. It starts with line 12

That is because you are looking at Form 1120-S pg 3-5. Look at Form 1120-S pg1-2.

@PTGeek wrote:
If end of year assets are < 1 million then I do not need to complete the balance sheet???

Your end of the year assets have to be less than $250,000.

Re: Addl info on 1120-S?

AliciaP1 — Thu, 24 Feb 2022 14:27:01 GMT

You are looking at "Form 1120S p3-5" which starts with Schedule B line 12. look higher up the menu on the left and you will see "Form 1120S p1-2" which ends with Schedule B line 11.

The requirement is if your assets are more than $250,000 and/or your total receipts were more than $250,000, you must report Schedule L, M-1, and the Balance Sheet.

@PTGeek