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While the at-risk limitations are calculated on IRS Form 6198 At-Risk Limitations and the passive activity limitations are calculated on IRS Form 8582 Passive Activity Loss Limitations, there is not an IRS form for the potential limitations on the amount of corporate losses that you may deduct based on your basis in the corporation. You would need to enter only the loss allowed on Line 1 of the Schedule K-1, and then manually track the shareholder basis and the amount not allowed in the current year which could be carried forward to the time when the basis in the S Corporation allows the loss to be taken.

IRS Shareholder's Instructions for Schedule K-1 (Form 1120S), page 2:

Limitations on Losses, Deductions and Credits

There are potential limitations on corporate losses that you can deduct on your return. These limitations and the order in which you must apply them are as follows: the basis rules, the at-risk limitations, and the passive activity limitations.

Each of these limitations is discussed separately in the instructions.

To navigate to the Worksheet for Figuring a Shareholder's Stock Basis:

Online:
  1. Sign in to your TaxAct Online return
  2. Click My Return on the right side of the screen
  3. Click Print Center, then click the Custom tab
  4. Click on the checkbox(es) to the left of the item(s) (the top section lists individual forms and schedules)  or  (the bottom section lists documents received or worksheets) which you wish to view or print (you may need to scroll down in the section to locate the item(s))
  5. Click the Print button and then click the PDF link. The item will appear in a PDF read-only format. At that time you can click the printer icon on the screen to actually print, or close the window without printing.
  6. NOTE: If, after you click Print in Step 5 above, you are directed to the Payment Option screen, you will need to process the product fees prior to printing.

Desktop:
  1. Start your TaxAct Desktop program
  2. Click the Forms button in the top left corner
  3. Expand the Federal folder and then expand the Worksheets folder
  4. Scroll down to the worksheet Schedule K-1 - Shareholder's Basis Worksheet
  5. Select the specific Shareholder Stock Basis Worksheet needed

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