Transactions Between a Shareholder and an S Corporation

Free CPA TCP (Tax Compliance & Planning) lesson in Entity Tax Compliance. 17 min read, ~2,562 words.

§351 applies to S corporation contributions: shareholder recognizes gain only to extent of boot received; corporation takes carryover basis in contributed property. S corporation distributions follow the AAA-first ordering rule: AAA (tax-free to extent of stock basis), then accumulated E&P (dividend), then remaining basis (tax-free), then excess (capital gain). S...

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What this lesson covers

Content
Example 1
Example 2
Common Mistakes
Key Takeaways
Exam Shortcuts

Learning objectives

II.B2

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