Welcome Guest. Register Now!  

LinkBack Thread Tools Search this Thread Display Modes
Prev Previous Post   Next Post Next
  #1 (permalink)  
Old 02-13-2015, 06:45 PM
Junior Member
Join Date: Feb 2015
Posts: 1
Question S-Corp Business Debt and S Corp Shareholder Loan

So, how much trouble do you think I'm in? I'm sole shareholder of an S corp that is, once I pay back a business credit card, 100% insolvent.

Over the years, I've taken out $50k in shareholder loans. This I know I'm on the hook for and there's no way I can pay this back in a lump sum now. I know I'll take some sort of tax hit on this (I'm pretty sure it will have to be taxed as income, as I recall, speaking with my accountant).

S Corp has a maxed out business line of credit of 50k with no personal guarantee. They've called the full amount due last month.

1. Is the IRS going to treat the 1099 for forgiven debt that is the responsibility of the S corp as income?

2. Because of the pass-through nature of the S-corp, is this debt going to be considered income, attributed to me personally? If I have $100k of extra "income" on my returns this year, I should go visit some personal bankruptcy forums

Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
I own 100% of an S-Corp and I have an outstanding loan from the corporation (TO me, the shareholder). Do I have to pay the loan BEFORE investing money into the business? SapoJow S-Corporation 1 05-05-2014 11:33 PM
Sale of business - S Corp - loss and loan Sammie S-Corporation 1 02-14-2014 01:32 AM
S-Corp Shareholder Loan Repayment Tax Liability Jaiy S-Corporation 3 12-30-2013 02:06 PM
Outstanding Loan to shareholder at Dissolution of S-corp kevinmac S-Corporation 0 11-24-2010 03:04 PM
S-Corp's "Loan to Shareholder" = cap gain on sale? kieso S-Corporation 0 10-05-2008 06:08 PM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 » Income
 » IRA/Sep
 » Medical
 » Payroll
Forum for CPAs
Financial Planning