Surgent's Understanding S Corporation Taxation: Shareholder Basis, AAA, and Retained Earnings

Overview

Even though they have been around for several years, the tax laws pertaining to S corporations remain some of the more difficult areas of the Internal Revenue Code. Given the rising popularity of S corporations, understanding how shareholder basis and the equity section of the balance sheet work together for tax purposes is imperative for nearly any tax practitioner. In this course, we will discuss this relationship. Using examples and illustrations, we will show how contributions, operating transactions, and distributions affect shareholder basis as well as equity.

Highlights

• S corporation earnings layers
• Observations on earnings layers
• S corporation basis calculation
• IRC 351 transactions
• Four loss tiers
• Appreciated property distributions

Prerequisites

None

Designed For

CPAs and tax practitioners who work with S corporation business clients and S corporation shareholders

Objectives

• Recognize the formula for calculating S corporation shareholder basis
• Identify the items of income and deduction that are allocated to AAA, PTI, AE&P, and OAA
• Calculate the tax effects of a distribution on shareholder basis and AAA

Preparation

None

Notice

This course is provided by a third-party vendor. Please note that login instructions will not be available in the ‘My Upcoming CPE’ section of the NESCPA website. Instead, the login instructions will be sent directly to you via email by Surgent. Upon completing the course, your hours will be recorded in the ‘My CPE Tracker’ section of the NESCPA website.