Basis of Shareholder's Interest in S Corporations

Free CPA TCP (Tax Compliance & Planning) lesson in Entity Tax Compliance. 18 min read, ~2,687 words.

Initial stock basis equals cash plus the adjusted basis of contributed property, reduced by liabilities the S corporation assumes on that property. Under §357(c), assumed liabilities exceeding the contributed property's adjusted basis are recognized as taxable gain. Stock basis increases for income items (ordinary, separately stated, tax-exempt) and capital contributions...

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What this lesson covers

Content
Example 1
Example 2
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Learning objectives

II.B1

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