S-Corporation Distribution from Retained Earnings-How to treat on 1040
I have a one-person S-corp which has been operational for a little over a decade. It has been profitable each year, never experiencing a loss. I have paid myself a reasonable salary, which has never been an issue. I have NEVER taken a distribution up until last year. Prior, the ordinary business income I had after paying my salary is usually between $2000-$5000. 2 years ago I had a very profitable year and had business income of $35,000. I did not pay this out as distribution.
I took a $55,000 distribution in 2018 which was basically 50% of the accumulated business income which I never took out of the business. My confusion is how to process this on my 1040, as I have already paid federal taxes on this and am assuming the entire distribution is tax free. Can you explain the mechanics of how this would work?
(Yes, I know I should talk to a CPA. I am currently interviewing CPAs to hire to perform my accounting)