Insolvent S corp

Forum|Forum|1 year ago
February 16, 2025
1 reply
15 views

Hi,

I'm working with an S-corp that had $80K of credit card debt cancelled in 2024. They have no other assets which should make them insolvent. My understanding is that this is not taxable to the shareholders. I plan to fill out form 982 and attach it to the final 1120S. Please correct me if I'm wrong but I think all I have to do is check box 1b under part 1 and put $80K on line 2. I don't think I have to fill out part 2 or 3. Do I have to attach something that lists the name of the credit cards and the amount cancelled for each?

Thanks

ProSeries Professional

This topic has been closed for replies.

T

Terry53029

Intuit Community Champion

check this from Tax Advisor.

https://www.thetaxadviser.com/issues/2015/may/tax-clinic-06.html

A

Avs19Author

Level 6

I came across this article before posting but it doesn't seem to go into detail on the 982 filing procedure.

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Terry53029

Intuit Community Champion

You would fill out the 982 by hand, as Pro Series S Corp does not support that form. then you would put any taxable amount, if any on the K1 to share holders. You could attach as a PDF to the return. I have never had myself, but that is the way I would handle it. Maybe some one will jump in that has done a 982 for s-corp

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