Identify Which of the Following Statements Is False

question 31

Multiple Choice

Identify which of the following statements is false.

• A)Randy is a shareholder in an S corporation. His stock basis is $10,000 and his basis in a loan he made to the corporation is $3,000. Randy's share of the corporation's ordinary loss for the current year is $11,000. Ignoring the at-risk and passive activity limitations, Randy can deduct the loss in full.
• B)A shareholder's S corporation stock basis will increase when the shareholder acts as guarantor on a corporate indebtedness.
• C)A shareholder's ratable share of the S corporation's ordinary loss reduces the adjusted basis of his/her S corporation stock. Once the basis of the stock is reduced to zero, any loss-passthrough that remains reduces the basis of S corporation debts that are owed to the shareholder.
• D)Debt basis is restored before stock basis.

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Definitions:

1865

The year marking the end of the American Civil War.

Voting Rights

The entitlements or privileges of individuals to participate in the electoral process, by casting votes in elections to choose their representatives.

Enfranchised Black Voters

Refers to African American citizens who have been granted the right to vote, particularly following historical movements for civil rights and voting equity.

Political Party

An organized group of people who share similar political views and work together to influence government policy and election outcomes.