What is the double entry for waiver of capital contribution from shareholder?

kirby

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Need a more detailed description of what happened. Did shareholder get more stock without having to pay for it?
 
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no the shareholder did not got any more stock. they had contributed to the company without intention of increasing the shares of the company, and recently they decided to waive the amoun the had contributes and for which no shares were issued.
 

kirby

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Did shareholder want money back? Or not money back but wants to not own the money they put in?
 
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They do not want their money back. The told the company that they will waive that amount.
 

kirby

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If shareholder gave money to company and got no equity in return then they made a gift, and that would be income to the company. Which is taxable so this makes no sense but ok there it is.
 
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Let say, the shareholder gave the company the loan to invest in equity items. whould this amount be categories as a capital nature item on reversal for tax purposes?
 

kirby

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Same as above, if shareholder gave money to company as a loan and then said no need for company to repay loan ever and also do not treat as equity infusion by shareholder, then it is a gift. Taxable.
 

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