Form 7203 quick help

Forum|Forum|4 years ago
April 18, 2022
1 reply
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Argh... last minute help, please!

I think I understand most of Form 7203.... 2 questions:
1) For Parts 2 and 3 (parts that reflect deb): Should we be putting a "-" sign in front of the amounts? Part 2 is a debt section, so I'm not sure if that will indicate a double negative and therefore calculate it as a +.

2) Part 3, column b instructions: "Enter any loss or deduction items disallowed due to basis limitations in prior years that were carried forward." How would I know if any amount was disallowed in prior years? On Schedule M-2 of my Tax Return, I've been carrying over our S Corp losses from year to year. I don't know how to determine how much, if any, the IRS didn't allow.

MANY THANKS!!!

Not A Product Question

PatriciaV

Level 15

1) There are no negative numbers anywhere on the form.

2) if in any year, the losses reported on Schedule K-1 took your basis below zero. those were "disallowed" and carried forward.

Note that Form 7203 reports your side of the investment. These calculations are not made by the S-Corp; these should come from your historical records.

For more assistance see:

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yoadrienne6Author

Level 2

@PatriciaV Thank you for your reply! But, I find it confusing in that you say that these are MY amounts, but every line of Part 3 of Form 7203 asks for the amounts from the K-1 (and the business loss from that IS from the Company), including "carryover amounts"....so how is that personal amounts if the language is specifically asking for K-1 amounts?

AliciaP1

Level 13

Your K-1 is YOUR share of the business activities. It makes more sense if there are multiple owners, but it is still valid if you are a sole owner of an S-Corp.

@yoadirenne6

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