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My client closed their business in 2017. The balance sheet…

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My client closed their...

My client closed their business in 2017. The balance sheet has a due to shareholder #1 of $2000. It also has a due from shareholder #2 of $8500. Distributions of $5125.00 each were taken by each shareholder. There is $1000 common stock on the books. AAA at the beginning of the year is $9103. I'm not quite sure how to close out this company without negative AAA.

Accountant's Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?

Not that I can think of

Submitted: 3 months ago.Category: Tax
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Answered in 13 minutes by:
1/9/2018
Tax Professional: Mark D, Enrolled Agent replied 3 months ago
Mark D
Mark D, Enrolled Agent
Category: Tax
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Experience: MBA, EA, Specializing in Business and Individual Tax Returns and Issues
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Hello, are the shareholders 50/50? Any other assets or liabilities left?

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Customer reply replied 3 months ago
Hi, yes, the shareholders are 50/50 (ex-spouses so that's why the due to/due from accounts are so whacky). No more assets or liabilities
Tax Professional: Mark D, Enrolled Agent replied 3 months ago

Thanks. Was the remaining cash $10250?

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Customer reply replied 3 months ago
The took it out early in the year
Tax Professional: Mark D, Enrolled Agent replied 3 months ago

I assume they didn't consult you :)

The balance sheet seems off balance. What is Retained Earnings before the distribution?

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Customer reply replied 3 months ago
Nope - not at all. I just found out I have to get on a conference call. May I reach out to you again tomorrow? Not sure when - may be tomorrow evening before I can get back to this client.
Customer reply replied 3 months ago
I have to pull some financials from them to figure out what they did to Retained Earnings.
Tax Professional: Mark D, Enrolled Agent replied 3 months ago

Sure, you can request to do a phone call if you like. May work better

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Customer reply replied 3 months ago
I'll let you know about the phone call - thanks for your patience!
Tax Professional: Mark D, Enrolled Agent replied 3 months ago

No problem, just respond here when ready

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Customer reply replied 3 months ago
Hi Mark, I was actually able to work through this myself but I'll be sure to contact you if I need any help on anything else! Have a great day!
Tax Professional: Mark D, Enrolled Agent replied 3 months ago

No problem!

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