how to retrieve stock and debt basis for s corp. if no available k-1 info. etc.

[cl2019]

a new client has never tracked his s corp. basis. the s corp. started in 2002 and it looks impossible for him to provide all past years' k-1s and debt information to retrieve the basis. How should I proceed? the s corp. has losses and will likely continue to have losses in the coming years. And schedule e of 1040 requires basis computation. How should I deal with this? Thank you!

 

[cl2019]

client's s corp is a simple structured one shareholder s corp. client says all past years k-1s only have ordinary income/losses and other items that do not impact stock basis. 

If this is the case, can I use shareholder's initial capital contribution plus retained earnings on its 2018 year balance sheet as the stock basis as of 2018 and move forward?

for debt basis, the shareholder has personal funds in and out of business account and balance sheets have categorized net personal funds in as loan from shareholder and net perssonal fund out as loan to shareholders. Is it too simple minded if I use 2018 balance sheet's loan from shareholder as the debt basis of 2018 and move forward? 

I will put a note with the tax return when preparing 2019 1040  to say that these basis calculations may need to be revised when all historical data is available to generate accurate stock and debt basis. 

anyone can comment on this approach? Thank you so much!

 

[Catherine]

Sometimes the best you can do, is the best you can do.  I've done the same, myself.  Certainly putting in the note about historical data is a good idea, "calculated from all information available as of date of preparation" is another.

[Terry D EA]

This is a different question along the same lines as the OP. A single member LLC that is taxed as an S-Corp, is required to calculate AAA, A&E as well as track capital and stock basis correct?