Mason Owns 45% of an S Corporation That Reported Net

question 20

Multiple Choice

Mason owns 45% of an S corporation that reported net income of $105,000 for the year.During the year, $20,000 was distributed to Mason from the corporation.Assuming Mason's QBI deduction is not limited, how much is the net amount that Mason is taxed on this year as a result of his investment in the S corporation?

• A)$16,000
• B)$37,800
• C)$45,000
• D)$53,800

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Definitions:

Embryo

An early stage of development in multicellular organisms. In humans, it refers to the stage from the first division of the fertilized egg until it becomes a fetus.

Fetus

The developmental stage of a human from the end of the eighth week after conception until birth, characterized by rapid growth and maturation of bodily structures.

Scaffolding

An educational approach that involves providing learners with temporary support in the initial stages of learning a new concept, gradually removing that support as the learner becomes more proficient.

Socialization

The process by which individuals learn and adopt the norms, values, behaviors, and social skills appropriate to their society.