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Federal input screens

Screen SBasis1 - Shareholder Basis (1041)

Enter
X
 to calculate the Shareholder Basis Worksheet and Form 7203, S Corporation Shareholder Stock and Debt Basis Limitation. This field marks automatically when any field in this screen has data. If this field is not marked, the basis worksheet does not calculate, and the losses and deductions is allowed without being limited by the shareholder basis. In addition, if this field is not marked, the SBasis1 and SBasis2 screen information does not proforma.
Enter
X
 if the shareholder is making an election in accordance with Regulation 1.1367-1(g). If this field is marked, basis by deductible items (such as ordinary loss) decrease before nondeductible noncapital expenses. If this field is not marked, basis by the nondeductible noncapital expenses reduces before the basis by the deductible items. The election statement under Regulation 1.1367-1(g) prints automatically unless the Election was made in a prior year field is marked.
Enter
X
 if the shareholder made an election in accordance with Regulation 1.1367-1(g) in a prior year. If this field is marked, basis by deductible items (such as ordinary loss) decrease before nondeductible noncapital expenses. The election statement under Regulation 1.1367-1(g) will not print if this field is marked.
When the Disposition of activity field in the K1 screen code is 1 (entire disposition), the Schedule D amounts for this activity, (from the statement for the Capital gains or (losses) field in the Income screen) are added to the amounts in the Other stock basis decreases statement in the SBasis1 screen on the basis worksheet. When code the Disposition of activity field in the K1 screen is 2 (disposition of passive activity sold on installment basis), the amount of the installment gain from this activity is added to the Other decreases in basis statement. Because the stock's basis is used to calculate the stock's gain/loss, the gain from the stock sale is not part of the stock's basis and the amount of other decreases is required. If the gain from the disposed activity is an amount other than the calculated amount, use this field to enter a different amount for other decreases. If you enter
0
 (zero), an amount is not produced in the Other decreases in basis statement.
When the code in the Disposition of activity field in the K1 screen is 1 or 2, the capital losses for this activity are excluded from the calculation of basis. (Capital losses are in the statement attached to the Capital gains or (losses) field in the Income screen.) The capital loss is not included in the basis calculation because the stock's basis is a component of the capital loss and should not be considered again in the calculation of basis. To include the losses for the activity from the B&D screen, Sales of Capital Assets statement, in the losses allocation worksheet for basis, enter
X
 in this field.
Enter the type of loan for the loan from shareholder. The system defaults to Open account debt if no code is entered. Loans with code 1 - Formal note and gain on repayment of the loan will be treated as long-term capital gain. Open account debt loans gains are treated as ordinary gains and reported on Form 4797, Part II.
When the loan basis is less than the beginning loan basis and the stock basis increased, UltraTax CS calculates the loan basis restored. A statement is produced showing the stock basis decrease and corresponding loan basis increase. Enter an amount, including 0 (zero), in this field to use an amount other than the amount calculated.
The recognized gain on repayment of a note coded as type 1 (Formal note) will default to long-term capital gain. Enter amounts in the force fields to use amounts other than the defaulted amounts. Enter a Holding period of recognized gain code to treat the gain other than long-term.

This article applies to:

  • PRODUCT: UltraTax CS
  • Return type: 1041 Fiduciary
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