I'm nearly there, but the balance sheet is not zeroing out.
I believe the issue is that I took distributions instead of contributing towards my Solo 401k during the year, as I knew I could pay off the 401k liability (recorded on Payroll bills) before the tax deadline (i.e. in the following year, before March 15).
Summary of the situation:
Example
I suppose by question is two part, how do I get the balance sheet to balance? Do I manually override the Retained earnings (change from 0 to negative) to offset the excess distribution, or offset it as "Adjustments to shareholder equity", or?
How do I avoid the Cap gains? I suppose the value of the tax deferral (30-40%) is still better than the Cap gains, but it's not a great situation. I suppose I can pull the money back out of e-Trade (say its an excess contribution) but then I'd have to sell the stock and I think that would be a mess.
You'll need to sign in or create an account to connect with an expert.
O tax basis at the start of the year. net profit $50. took a deduction but didn't pay the 401(k) amount thus took $75 in distributions,. sorry, you do have an excess distribution of $25. that $25 was supposed to be retained by the S-Corp to pay off the 401(k) liability. your balance sheet would show a $25 liability for the 401(k) and a deficit in retained earnings of $25. run to a tax pro the return is due in 4 days.
Still have questions?
Make a postAsk questions and learn more about your taxes and finances.
zzz8881
Returning Member
kiks_722
Level 1
arhaak
New Member
yayaroon
Level 2
movinit56
Level 3
Did the information on this page answer your question?
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.