Explore BrainMass

Explore BrainMass

    Basis of S corporation Shareholder

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    How does the basis calculation of an S corporation shareholder basis differ from a partner and a partnership? Discuss any recent developments in the calculation of the S corporation shareholder's basis.

    response is 415 words, includes references

    © BrainMass Inc. brainmass.com June 4, 2020, 12:50 am ad1c9bdddf
    https://brainmass.com/business/cash-vs-accrual-accounting/basis-corporation-shareholder-363381

    Solution Preview

    The S corporation basis calculation shareholder basis is stock value plus loans from the owners to the S corporation plus S corporation profits minus S corporation loss minus distribution to owners (www.macymorris.com). S corporation's basis seems important because the S corporation members cannot take out more money than they have put into the corporation and more than the corporation has earned without paying taxes. An S corporation member cannot take a loss on their taxes if they have a negative basis, but they do have to report profits on their taxes even with a negative basis.

    In a partnership, there are two basis called the inside ...

    Solution Summary

    How the basis calculations of an S corporation shareholder basis differs from a partner and a partnerships is determined. The recent development in the calculations of the S corporation shareholder's basis is determined.

    $2.19

    ADVERTISEMENT