A Calendar Year C Corporation Reports a $41,000 NOL in 2015

question 53

Multiple Choice

A calendar year C corporation reports a $41,000 NOL in 2015, but it elects S status for 2016 and generates an NOL of $30,000 in that year. At all times during 2016, the stock of the corporation was owned by the same 10 shareholders, each of whom owned 10% of the stock. Kris, one of the 10 shareholders, holds an S stock basis of $2,300 at the beginning of 2016. How much of the 2016 loss, if any, is deductible by Kris?

• A)$0
• B)$2,300
• C)$3,000
• D)$7,100

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