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  • 1.  Partnership to S Corp

    Posted 10-20-2014 05:34 PM
    I have a company that was a Partnership through 12/31/13.  As of 1/1/14 they converted to an S-Corp.  How do you record the closing out of the capital accounts when transferring the records to the S Corp.  Do they go to Shareholder Loans or some other account on the S Corp books?
    Thanks in advance for your help!
    Chris

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    Chris Murphy BA
    SANDRA JOHNSON, CPA PC
    Bellmore NY
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  • 2.  RE: Partnership to S Corp

    Platinum Most Valuable Member
    Posted 10-21-2014 01:08 PM
    Chris:

    The first question is, what was transferred, as these are two separate legal entities? You want to make avoid creating a taxable transaction. As a matter of course, I do not post anything to officer loans, other than true loans, I post to additional paid in capital (second class of stock issues).

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    Robert Brown
    ROBERT N. BROWN, CPA
    Jericho NY
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