Robin Johnson
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Posts posted by Robin Johnson
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Yes. Totally. They took a $33,000 distribution and have no basis. Their tax exempt/ppp loan forgiveness is $71,000. The software is not showing the distribution on line 7 of the M-2 AAA column but when it loads to their 1040 it is allowing the distribution due to the $71,000 ppp income.
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So the PPP loan forgiveness is an addition item and with the ordering rules gets to take a distribution against this forgiveness even though the company has a loss overall for the year and no beginning AAA to support the distribution?
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Thank you! I did end up putting on line 7 of the M2. I also opened a case. I blew a half a day trying to get the program to do this properly.
I also sent the service rep this link to try to explain to her what the issue was:
support.cch.com/kb/solution/000119778/119778
ATX needs something like what here. A check box so that the program does this correctly. Thanks to all of you for helping me out. I'm a sole practitioner and I'm very grateful to have people like you supporting this community! Have a great tax season!
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It's an operating business
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Thank you for your reply. Yes. They are on line 10 of page 1. So net income per books on the M1 is correct but then line 3 of the M1 has the Guaranteed payments listed as an M-1 adjustment. Is that right? That's what's messing up my return.
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I am having trouble with the M-2. My net income per books is overstated by the guaranteed payments. Is there somewhere in ATX where I can check a box to deduct the guaranteed payments?
S-Corp Instructions 2021 Updates, PPP Forgiveness Reporting
in General Chat
Posted
If I reduce OAA by the ppp related expenses then there is no OAA availing for the distribution. It should be a capital gain on the shareholder's 1040 but when it imports, I think due to the ordering rules, it allows them the distribution and also allows them a prior year carryover loss to the extent that the distribution was less than the PPP loan. So confused.