S Corp Alert

S corporation owners can only deduct losses up to the amount of their basis in the shares. But some business owners ignore this limit, much to the chagrin of the IRS. Now the tax collection agency’s Large Business and International Division is ramping up audits in this area. Its agents will contact shareholders to ensure they are properly limiting their losses to their stock basis.

Small Business Tax Strategies Vol 12. No. 7 July 2017