IRS Form 7203 Walkthrough (S Corporation Shareholder Stock and Debt Basis Limitations)
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- เผยแพร่เมื่อ 21 ต.ค. 2024
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Here are links to articles we've written about other tax forms mentioned in this video:
IRS Form 8949, Sales and Other Dispositions of Capital Assets
Article: www.teachmeper...
Video: • IRS Form 8949 walkthro...
IRS Schedule D, Capital Gains and Losses
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Video: • IRS Schedule D Walkthr...
You are such a genius!! This form was just required by the IRS in 2021 and you were able to explain it so clearly!!
Thanks! Your video and the step-by-step directions in the article were VERY helpful. I appreciate that you took the time to put this educational information out to help others. I'll bookmark your website.
Just found my answer to my question below from the Journal of Accountancy. "It should be pointed out that an S corporation shareholder’s basis in stock is reduced by current-year losses, regardless of whether the loss or deduction is disallowed under another rule, such as the passive loss rules.".
Thank you for sharing your knowledge, very well explained
Very helpful, thank you. Is it possible line 21 is great than line 16? I have a hard time understanding when line 18 is greater than 1.
Although the form instructions don't say anything about this, I found the following on a tax preparation software website:
If the amount in the total column for Line 21 is greater than the amount in the total column for Line 16, no entry is made.
Thank you. Once completed where do I send it? And is there a fee to pay to file?
You use this form in conjunction with your Form 1120-S and Schedule K-1, so you do not need to file it separately. You should keep a copy with your tax returns for accuracy. There is no separate fee for this form.
I am selling all my shares of a Scorp to my partner. Would the gain against my cost basis be added to the 7203? Will the K1 have these numbers as well? Thanks in advance
I am not 100% sure, since there are a lot of things that I don't know about your S corporation. But when I sold shares of my S corporation 2 years ago, here's what was reported:
-Basis of S corporation shares: IRS Form 7203 (contained nothing to indicate that capital gains were applied to the basis)
-Long-term capital gains: Schedule D and IRS Form 8949 (see below).
I also received a Schedule K-1 from the S corporation, which contained the items that impacted my stock basis on Form 7203.
IRS Schedule D, Capital Gains and Losses
Article: www.teachmepersonalfinance.com/irs-schedule-d-instructions/
Video: th-cam.com/video/wpPXe8z40lY/w-d-xo.html
Playlist: th-cam.com/play/PLYHzJrFFCrpx8fntib5MeAQ7xMEfvPVHZ.html
IRS Form 8949, Sales and Dispositions of Capital Assets
Article: www.teachmepersonalfinance.com/irs-form-8949-instructions/
Video: th-cam.com/video/O5P_L9zdXME/w-d-xo.html
@@teachmepersonalfinance2169 Thanks. I appreciate your response!
What about passive loss or deduction expenses that are already carried forward? I would think the basis would be limited to what was allowed through form 8582. For example if the k-1 shows a loss of 5,000.00 dollars but it can not be deducted because of lack of participation (passive income/loss), then I would think my basis would not be affected until the carry over is used. But how is this reported on this form 7203. Assuming the k-1 shows a non dividend distribution of some amount. Thus forcing this form to be filed. Does anyone have any thoughts on this. Or, am i making up a problem?
Thank you for the video
You're welcome!
What if the 3rd party loans are paid by the business?
Could you explain your question a little more? I'm not sure that I understand your intent.
I am 100% shareholder of my SCorp. I received a loan from a 3rd party lender and the S Corp pays back the loan. Is this considered a stock basis?
@@CryptoQueen8888 Did you receive the loan personally, or did the S corporation receive the loan?
@teachmepersonalfinance2169 The corporation received the loan and the loan was paid back by the corporation. Thank you for responding!