Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 05-21-2016, 07:47 PM
Junior Member
 
Join Date: May 2016
Posts: 1
Post Distributions

S Corp distribution are taxed as long term Capital Gains. They flow over to the 1040. I am confused it adds to the Total Income and flows down the 1040.

Does this mean that S-Corp Distributions get taxed LTCG + Fed Income Tax? Or some how the software just taxes it on LTCG and not Fed Income tax?



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
  #2 (permalink)  
Old 05-22-2016, 06:01 PM
Moderator
 
Join Date: Oct 2010
Posts: 5,258
S Corp distribution are taxed as long term Capital Gains. They flow over to the 1040. I am confused it adds to the Total Income and flows down the 1040.======> a distribution of cash or property by an S corp may;the distribution may result in a tax-free reduction of the shareholder?s basis in the corporation?s stock; a taxable dividend, or Gain from the sale of the stock (generally resulting in capital gain).so what you mean is s corp distribution is taxed as a capital gain only when the distribution amt exceeds yur basis in the S corp. so I mean The tax consequences of distributions byyour S corp to you, a shareholder , depend on the shareholder?s basis in the S corp stock. Distributions to you are not included in your gross income to the extent that the distribution does not exceed the your basis in the stock


You , as a shareholder/employee in the S corp, are required to annually adjust your outside basis in the corp?s stock in order to reflect the items of income gain, loss, deduction and distribution allocated to you. These annual adjustments are necessary to preserve the single level of taxation afforded to S corps. Of utmost importance is the order in which these adjustments are required to be made. This is because while distributions reduce your AAA baqalnce/inside/outside basis, in many cases, it is your stock basis that will in turn determine the taxability of a distribution. However in reality, many are unaware of the necessity.

Does this mean that S-Corp Distributions get taxed LTCG + Fed Income Tax? Or some how the software just taxes it on LTCG and not Fed Income tax?====>>>>>>>>>>>>>>As mentioned above; it deepdns; you MUST pay tax on your S corp distribution oNLY when the amt exceeds your basis in the Sc corp.



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
  #3 (permalink)  
Old 06-01-2016, 01:59 AM
Junior Member
 
Join Date: Jun 2016
Location: Santa Ana CA
Posts: 1
An eligible domestic corporation can avoid double taxation by electing to be treated as an S corporation. You can discuss your doubts with us, here is an expert advice for all your questions.



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
Ads
Reply


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
Reporting Distributions newtgmember2759 For 2013 3 01-18-2015 04:56 AM
Forgot to take distributions.... Ohio_Dan S-Corporation 2 12-28-2013 10:29 PM
S Corporation Distributions Tebow2259 S-Corporation 0 10-11-2011 08:38 AM
Accrued Distributions preter S-Corporation 0 12-14-2009 08:14 PM
S Corporation Distributions maverick S-Corporation 1 01-04-2008 11:25 PM

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

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

» Recent Tax Q&A
No Threads to Display.