S-Corp

USA Discussion in 'General Accountancy Discussion' started by Mandi R, May 16, 2018 at 2:36 PM.

  1. Mandi R

    Mandi R

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    I had a question I wanted some opinions on. Two owners of an S-corp have loaned the S-corp funds for various reasons over the past few years. The loans are documented stating they are loans but there is not interested that was charged. Most loans were over $10k.

    What are the possible negative effects of this in case of an audit? I understand the IRS could consider these to be capital rather than loans.

    The S corp has never had a profit.

    Thanks for your thoughts!
     
    Mandi R, May 16, 2018 at 2:36 PM
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