This has been an incredibly educational thread that perfectly illustrates why S-Corp treasury stock transactions require such careful planning! As someone new to this area, I'm grateful for all the practical insights shared here. One additional consideration I'd like to add based on recent experience: make sure to review your corporate insurance policies (D&O, E&O, etc.) after completing the buyout. Many policies have clauses that require notification of material changes in ownership structure, and some coverage amounts are based on number of shareholders or ownership percentages. Also, regarding the AAA reconstruction discussion - I recently worked with a CPA who specializes in S-Corp compliance to clean up our AAA tracking. They discovered that we'd been making an error with separately stated items that was affecting our AAA calculations. The process took about 6 weeks but was absolutely worth it for the peace of mind and accurate baseline before considering any major transactions. The unanimous advice about professional consultation really resonates. Between the potential for second class of stock issues, state filing requirements, distribution timing coordination, and all the documentation needs discussed here, it's clear that expert guidance is essential. For anyone else considering similar transactions, I'd highly recommend getting your AAA tracking squared away first, then engaging both a tax professional and corporate attorney who have specific S-Corp experience. This thread has been an invaluable roadmap for understanding all the moving pieces involved!

This has been such an incredible resource! As someone completely new to S-Corp treasury stock transactions, I'm blown away by how comprehensive this discussion has become. Reading through everyone's real-world experiences has been like getting a crash course in all the complexities I never knew existed. What really strikes me is how what seemed like a straightforward accounting question about journal entries evolved into covering virtually every aspect of S-Corp compliance - from AAA calculations and distribution ordering rules to state filing requirements and corporate governance considerations. The practical insights everyone shared, like the quarterly tax payment adjustments and insurance policy updates, are exactly the kind of details you'd never think to consider until you're in the middle of the transaction. I'm particularly grateful for the specific guidance on selecting professional help - asking about experience with treasury stock transactions and second class of stock issues seems crucial when choosing advisors. The point about many general practitioners missing S-Corp nuances really emphasizes why specialized expertise is so important. One question that occurred to me while reading through all this: Given all the complexity around timing and coordination (AAA impacts, quarterly payments, distribution scheduling, etc.), is there an optimal time of year to structure these types of buyout transactions? It seems like early in the tax year might provide more flexibility for managing the various implications throughout the year. The consensus on professional consultation is absolutely convincing after seeing all the potential pitfalls discussed here. This thread should be required reading for anyone considering S-Corp treasury stock transactions - the collective wisdom shared here is invaluable!

Had this last year, lost half my refund to a state tax debt from a state I hadn't lived in for 5 years! The most frustrating part was finding out which agency took the money. Ended up using taxr.ai to decode my transcript and figure out what happened, then used claimyr.com to actually get through to the IRS to confirm. FINALLY got answers after weeks of confusion. Honestly, these tools are worth it if you're dealing with offset issues - saved me so much time and stress.

This exact same thing happened to me last year! The vague messaging in the app is so stressful when you're expecting your refund. What helped me was calling the Treasury Offset Program directly at 800-304-3107 - they can at least tell you if there's an offset in the system for your SSN and which type of debt (federal student loans, child support, etc.). The IRS agent was right that they've already processed the offset, so whatever amount is left should deposit soon. The BFS notice explaining exactly what was taken usually arrives 1-3 weeks AFTER your reduced refund hits your account, which is backwards but that's how the system works. If you want to understand what's happening right now instead of waiting, I'd recommend checking your tax transcript on IRS.gov and looking for transaction code 898 (refund offset). That will show you the amount that was offset, though not which agency claimed it. Don't stress too much - sounds like everything is processing normally, just with an offset you weren't expecting!

Anybody know if there's any way around providing your SSN to Ticketmaster? I'm in the same situation - sold tickets for a $75 loss and now they want my tax info before releasing my money. I'm really uncomfortable giving them my full SSN.

I went through this exact same issue with Ticketmaster about 6 months ago. Yes, this is completely legitimate - they're required by law to collect tax information for any payments over $600 due to the American Rescue Plan Act changes that went into effect in 2022. A few important points: 1. You DO need to provide your SSN to get your money - there's no way around this unfortunately 2. Make sure you're filling out the form through Ticketmaster's official website or app, not through any email links 3. Since you sold at a loss ($285 → $220), you won't owe any taxes on this transaction 4. Keep all your documentation (original purchase receipt, resale confirmation, etc.) for your tax records The process took about a week for me after I submitted my tax info. I know it feels invasive, but unfortunately it's the new reality with these platforms. The good news is that this protects you too - you'll get proper documentation showing you sold at a loss, which can be helpful for your tax records. Just make absolutely sure you're dealing with the real Ticketmaster and not a phishing attempt. When in doubt, log into your account directly through their main website rather than clicking any links.

The IRS verification system is basically the DMV of the digital world! 😂 But seriously, everyone's timeline is different, and the blinking bar is just their way of saying "we're thinking about it." I've been through this twice (thanks identity thieves!), and both times it resolved within 2 weeks. Hang in there - it's frustrating but the system does eventually work. Your refund is coming, just on IRS time, not human time.

I'm in the exact same boat! Completed my ID verification through ID.me on Monday and still seeing that frustrating blinking bar. Reading through everyone's experiences here is actually really reassuring - sounds like 9-15 business days is pretty normal even though it feels like forever when you're waiting for your refund. I'm going to try checking my transcript like some of you suggested. Does anyone know if there's a specific code that shows up when verification is actually complete in their system? Also curious if anyone has noticed if filing early vs. late in the season affects these processing times at all. Thanks for sharing your timelines - it really helps to know this delay is normal and not a sign something went wrong!

I think we're overcomplicating this. The rule is simple - if it's personal, it's not a corporate expense, period. It doesn't matter if you call it non-deductible on M-1, it's still a distribution to the shareholder. The only legitimate non-deductible expenses are things that benefit the corporation but aren't deductible under tax law (life insurance premiums, certain penalties, 50% of meals, political contributions, etc). I tell my clients there are only 3 ways to get money out of a C-corp: 1. Salary for services actually rendered 2. Loans (with proper documentation) 3. Dividends Anything else is just dividends in disguise, and the IRS isn't stupid.

This is exactly the kind of situation that drives me crazy as a tax professional. You're absolutely right to push back on the previous accountant's approach. The fundamental test isn't whether an expense is deductible - it's whether the expense has ANY legitimate business purpose. Personal expenses like family vacations and tuition have zero business purpose and should never touch the corporate books, even as M-1 adjustments. I've seen too many practitioners use the M-1 approach as a lazy way to avoid difficult conversations with clients. But you're setting up both yourself and the client for problems down the road. The IRS has gotten much more aggressive about constructive dividend audits, especially with closely-held C-corps. My advice: bite the bullet now and clean this up. Reclassify the personal expenses as dividends (or loans if there's proper documentation and repayment ability). Yes, it'll create some additional tax liability, but it's better than dealing with an IRS audit that could go back multiple years with penalties and interest. The client may not like it initially, but they'll thank you when they're not facing a massive IRS bill later.