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| Name | IRS Form 7203 Developments - Shareholder Basis Reporting For S Corporations 2021 |
| Video Uploader | Video From Freyman CPA |
| Upload Date | This Video Uploaded At 10-01-2022 15:30:44 |
| Video Discription | The IRS is revving up reporting with new form 7203 - tracking shareholder basis in an S corporation. Shareholders/owners of an S corporation are responsible for tracking their basis in the entity. Basis means the equity in the business or what a shareholder is financially are at risk. Examples of increases in shareholder basis would be capital contributions into the S corporation, net profits from yearly business operations, and personal loans into the entity. Examples of decreases in shareholder basis would be capital distributions from the S corporation, net losses from business yearly business operations. Certain activities can trigger capital gains, as in distributions in excess of basis. How can this happen? Suppose the S corporation takes a business loan (not a shareholder loan but an entity level loan), and the shareholder distributes the funds to themselves personally. In that case, that will, in most instances, trigger a capital gain distribution in excess of shareholder basis. Reasons some owners will have difficulties in reporting their basis in the S corporation can include: -not tracking basis it in the past -not reporting the balance sheet yearly with the return or not having a balance sheet created - this may happen when an accountant just took the client profit and loss statement and only used those records for tax reporting -incorrect reporting of basis in the past DISCLAIMER: All Freyman CPA, P.C. videos are provided for general informational purposes only and deal with dynamic, time-sensitive, complex matters that may not apply to particular facts and circumstances. Information provided here should not be relied upon as a substitute for professional advice in connection with any particular matter. We try to ensure accuracy, however, all information provided to you is provided “as is”, with no guarantee of completeness, accuracy, timeliness, or of the results obtained from the use of this information, and without warranty of any kind, express or implied. Any information provided to you is not a substitute for professional legal, tax, or accounting advice. Laws, rules, policies, and regulations change from time to time and the application and impact of laws can vary widely based on the specific facts involved. Accordingly, before making any decision or taking any action, you should consult a professional advisor. Facebook - https://www.facebook.com/businessaccountantsjacksonville Official Website - https://www.taxproff.com #TaxAdvice #TaxExtension fQ7XPWDUqEw |
| Category | Education |
| Tags | form 7203 | IRS form 7203 | Shareholder basis reporting 2021 | calculating S corporation shareholder basis | S corp basis | new IRS form 7203 2021 | difficultyu calculating sharheolder basis in aS corporation | s corporation basis | distributions in excess of basis | contributions to s corporation basis | freyman CPA | s corp distributions | shareholder basis | s corp debt basis |
