Did you report the S Corp (with loss) as a passive activity - you may want to review your entries in Turbo-tax with specific regard to all the questions you answered in the process. It is possible that you may have checked the box that "All the basis/investment is not at risk" or that the basis is not sufficient.
Normally you are allowed loss to the extent of your basis and loan in the S Corp.
Let me know if you have any question.
Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.