During 2014, Miles Nutt, the Sole Shareholder of a Calendar

question 152

Multiple Choice

During 2014, Miles Nutt, the sole shareholder of a calendar year S corporation, received a distribution of $16,000. On December 31, 2013, his stock basis was $4,000. The corporation earned $11,000 ordinary income during the year. It has no accumulated E & P. Which statement is correct?

• A) Nutt recognizes a $1,000 LTCG.
• B) Nutt's stock basis will be $2,000.
• C) Nutt's ordinary income is $15,000.
• D) Nutt's return of capital is $11,000.
• E) None of the above.

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Definitions:

Cerebral Cortex

The outer layer of the brain's cerebrum, playing a key role in memory, attention, perception, awareness, thought, language, and consciousness.

Positive Situations

Circumstances or environments that lead to beneficial or favorable outcomes for an individual.

Stress

The physiological reaction to stimuli or stressors, whether they're of a physical, mental, or emotional nature.

Paraphilia

A condition characterized by abnormal sexual desires that involve extreme or atypical scenarios.