S Corp Stock Basis
I recently started an S Corp. in the state of Virginia. I did not have to invest any property or cash contributions to start off, just because I already had a few customers that I would invoice in the first month and already had a computer and software (but again, I am not adding those to the balance sheet). I have no debt basis to begin with either. I am 100% stock owner and my articles of incorporation and stock ledger both show that I value my company at 1,000 shares worth $20.00 par value each. I just set this number based on my own valuation, but again, I did not contribute $20,000.00 to the company to start.
My question is, do I have an initial basis of $0.00 or $20,000.00. I am wanting to start off a clean basis worksheet and didn't know how I should handle the starting basis.