Suppose Clampett, Inc

question 32

Multiple Choice

Suppose Clampett, Inc. terminated its S election on August 28, 2016. At the end of the S corporation's short tax year ending on August 28, J. D.'s stock basis and at-risk amounts were both zero (he has never had debt basis) , and he had a suspended loss of $20,000. In 2017, J. D. made additional capital contributions of $5,000 on March 15 and $12,000 on September 20. How much loss may J. D. deduct in 2017?

• A) $0.
• B) $5,000.
• C) $17,000.
• D) $20,000.
• E) None of these.

---

Definitions:

Habituation

The diminishing of a physiological or emotional response to a frequently repeated stimulus, leading to decreased attention or reaction over time.

Shaping

A method of training by which successive approximations towards a desired behavior are reinforced.

Discrimination

Unfair treatment of individuals based on their race, gender, age, or other characteristics rather than their merits.

Flooding

Confronting your worst fear head-on, all at once.