Hello, As the owner of an S-Corporation, I've traditionally taken out about half my compensation in salary and half in dividends. A few years ago, we filled up an almost $200,000 line of credit during a major move/expansion. That was right before the economy went into the tank. We've made it through the storm so far, but we haven't been able to knock down the principle much. Recently, though, my accountant told me that I should not be taking dividends anymore because my basis in the company is less than the amount of debt. Does this sound accurate? It definitely caught me off guard, and this accountant has been less than reliable in the past; so, I thought I'd throw it out to this forum. Thanks in advance for any advice.