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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Definitions:

Stereochemical Designator

Notations used to describe the spatial arrangement of atoms around a stereocenter or double bond in a molecule, such as (R)/(S) or (E)/(Z) configurations.

Methylbutene Structures

Refers to the structural variations of the hydrocarbon molecule butene, with one or more methyl groups attached to its chain.

Hydrogenation

The chemical reaction between molecular hydrogen (H2) and another compound or element, typically in the presence of a catalyst, resulting in the addition of hydrogen.

Bredt's Rule

A principle in organic chemistry stating that bridgehead carbon atoms cannot possess double bonds if the ring system is small due to excessive angle strain.