S Corp. Distributions: Determining the Taxability
Author: Jennifer Kowal
| CPE Credit: |
2 hours for CPAs
2 hours Federal Tax Related for EAs and OTRPs
2 hours Federal Tax Law for CTEC |
S corporations commonly make distributions to shareholders. Determining whether the distributions are taxable distributions or return of basis largely depends on shareholder basis. Additionally, it may be difficult to determine if a distribution is a loan, a loan repayment, a salary, or a distribution of income. This course will provide detailed training on how the intersection of these rules affects taxability of distributions of cash and property by an S corporation, illustrated with case studies.
Publication Date: March 2023
Designed For
Tax practitioners at all levels who provide advice and return preparation involving S corporations.
Topics Covered
- Rules regarding passthrough of S corporation items of income and deductions
- Additions to S corporation basis, including effects of S corporation liabilities
- Characterization of distributions as salary vs. distributions of income
- Loans between S corporation and shareholders
- Tax distributions
Learning Objectives
- Describe transactions and events that increase and decrease a shareholder's basis in S corporation stock
- Identify the difference in treatment between distributions of salary, S corporation income, and shareholder loans
- Recognize how to explain how tax distributions work, and how they affect future distributions of cash and property
Level
Basic
Instructional Method
Self-Study
NASBA Field of Study
Taxes (2 hours)
Program Prerequisites
None
Advance Preparation
None
