DESCRIPTION
This module provides an opportunity for students to fully understand the intricacies of S corporation shareholder basis and the importance of maintaining basis records. The students will learn how basis limitations lead to suspended losses and/or taxable income to the shareholder, including those transactions arising from former C corporations.
LEARNING OBJECTIVES
- Describe the importance of maintaining shareholder basis
- Identify the increases and decreases to shareholder basis
- List the ordering rules for items that affect shareholder basis
- Identify taxable events that arise from limited shareholder basis
- Calculate shareholder basis under various scenarios
- Describe the basis implications of former C Corporations
- Identify the difference between tax basis and at-risk limitations
