Suppose at the Beginning of 2018, Jamaal's Basis in His

question 54

Multiple Choice

Suppose at the beginning of 2018, Jamaal's basis in his S corporation stock is $0, he has a $0 debt basis associated with a $10,000 loan he made to the S corporation and a $5,000 suspended loss from the S corporation. In 2018, Jamaal contributed $8,000 to the S corporation, and the S corporation had ordinary income of $4,000. Assume that Jamaal owns 40% of the S corporation. How much net income or loss does Jamaal report this year from the S corporation?

• A) $4,000 income.
• B) $1,600 income.
• C) $1,000 loss.
• D) $3,400 loss.
• E) None of the choices are correct.

---

Definitions:

Treatises

Comprehensive and detailed written works, often on legal topics, that systematically cover the principles and laws related to a specific subject.

Law Review Articles

Scholarly articles published by law schools, usually written by law professors, scholars, or legal professionals, on various legal issues and topics.

Legal Research

The process of identifying and retrieving information necessary to support legal decision-making, encompassing a variety of resources such as statutes, case law, and legal writings.

Computer-Assisted

Supported or enhanced by the use of computers, often referring to tasks or processes that are made more efficient or accurate through digital technology.