S Corporations: Distributions, Stock Basis And Loss Limitations

Course Details

Date

Thursday, October 24, 2019

7:30am – 9:30am
(Registration: 7:00am)

Field of Study

Taxation

Course Number

4193331B

CPE Credit

2.0 hours CPE credit

Level of Knowledge

Overview

Vendor

CalCPA Education Foundation

Prerequisites

Understanding the basics of taxation of corporations, S corporations and partnerships.

Description

Making the S election helps avoid double taxation for corporate operations after the election is effective. Consider the special rules related to adjusting the stock adjusted basis, distributions and loss limitations.

Rules surrounding the S election are necessary to accomplish the single level of tax at the shareholder level. Evaluate the details of the adjustments to stock basis. Cover descriptions and illustrations regarding the calculation of the "accumulated adjustment account" (AAA) and the determination of whether a distribution is from AAA.

The loss limitation rules will be explained and illustrated with special focus on complications arising when both distributions and losses occur in the same taxable year. Also, take into account the tax considerations of losses reducing the adjusted basis in shareholder loans. Identify and evaluate tax planning opportunities and strategies.

Materials are provided as an ebook for this course.

Highlights

  • Details of the stock basis adjustments when an S election is effective
  • Rules that characterize distributions to S corporation shareholders either as potential stock basis reductions or dividend income
  • Definition of "accumulated adjustment account" (AAA)
  • Special rule when there is a "net negative adjustment"
  • The rule limiting losses to stock and shareholder loans to the corporation
  • The tax complications related to using shareholder loans to the corporation to deduct losses
  • The basis adjustment ordering rules when there are losses and distribution in same taxable year
  • Tax planning opportunities and strategies

Objectives

  • Recognize the adjustments to stock basis rules.
  • Characterize the tax treatment of a distribution based on the ability to determine the balance in the accumulated adjustment account (AAA).
  • Apply the loss limitation rules considering both stock and debt basis.
  • Determine the tax consequences of distributions made in the same year that there is a loss.
  • Identify and evaluate tax planning opportunities and strategies.

Designed For

CPAs and attorneys.

Course Pricing

Member Fee

Applicable if you are a HSCPA member in good standing.

$60.00
Non-Member Fee

Applicable if you are not a HSCPA member.

$94.00
Your Price $94.00

CPE Choice

Learn more about CPE Choice.
This course does not qualify for CPE Choice.

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