Question

If losses are suspended due to the lack of basis in S corporation stock, do the...

If losses are suspended due to the lack of basis in S corporation stock, do the losses expire when the S election terminates?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

shareholder facilitate or expedite the use of his suspended losses. There are some options to consider:

1. Make a capital contribution to the corporation (using the shareholder’s own funds, or using funds borrowed from a third party; paying off a corporate debt)

2. Forego distributions by the corporation in profitable years (loan the distributed funds back to the corporation)

3. Accelerate the recognition of income by the corporation

4. Defer the deduction of corporate expenses

5. Make a loan to the corporation (using the shareholder’s own funds, or using funds borrowed from a third party; substituting the shareholder’s note for the corporation’s)

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
If losses are suspended due to the lack of basis in S corporation stock, do the...
If losses are suspended due to the lack of basis in S corporation stock, do the losses expire when the S election terminates?
Suppose that at the beginning of 2019 Jamaal's basis in his S corporation stock is $2,300...
Suppose that at the beginning of 2019 Jamaal's basis in his S corporation stock is $2,300 and he has a $11,300 debt basis associated with a $11,300 loan he made to the S corporation. In 2019, Jamaal's share of S corporation income is $5,300, and he received a $8,300 distribution from the S corporation. What is Jamaal's stock and debt basis after these transactions?
true / false: 1 - Losses not deductible due to the stock basis loss limitation rule...
true / false: 1 - Losses not deductible due to the stock basis loss limitation rule are carried over to future years. 2- The definition of property as it relates to an IRC §351 exchange includes money. 3- Gain and loss realized in an IRC §351 exchange will be recognized if the taxpayer receives boot in the exchange. 4 -Activities conducted by business entities are treated as either a trade or business or a hobby
Charles owns a 25 percent interest in Cal Corporation, an S corporation. The corporation has run...
Charles owns a 25 percent interest in Cal Corporation, an S corporation. The corporation has run into some difficulties recently and Charles loaned it $10,000. At the beginning of the year, Charles’s basis in his stock was $16,000. What is Charles’s basis in his stock and debt at the end of the year if the corporation reports losses of $60,000? What is Charles’s basis in his stock and debt at the end of the year if the corporation reports losses...
Which of the following is not an adjustment to an S corporation shareholder's stock basis? Multiple...
Which of the following is not an adjustment to an S corporation shareholder's stock basis? Multiple Choice Increase for any contributions to the S corporation during the year. Increase for shareholder's share of ordinary business income. Decrease for shareholder's share of nondeductible items. Increase for distributions during the year. None of the choices are correct.
a U.S. Citizen, is a sole shareholder of S corporation. He has $5,000 basis in stock....
a U.S. Citizen, is a sole shareholder of S corporation. He has $5,000 basis in stock. also loaned money to S Corporation and has basis of $3,000. Assume no AEP, calendar year and beginning balance of AAA and OAA accounts are zero. The corp. made $10,000 in the ordinary income which was reported on K-1. Corp. also received a tax- free interest income of $4,000 which was also reported on K-1. Ryan took a distribution of $21,000 during the year...
How many classes of stock are allowed for a corporation that wishes to make the S...
How many classes of stock are allowed for a corporation that wishes to make the S corporation election? 1 2 3 4
Which of the following increases a shareholder’s S corporation stock basis? a.         Depletion deductions in excess...
Which of the following increases a shareholder’s S corporation stock basis? a.         Depletion deductions in excess of the basis of property taken in computing operating income. b.         Illegal kickbacks received. c.         Nontaxable income received. d.         Sales income. e.         All of the above increase basis.
Ambros transfers property (basis of $320,000 and fair market value of $210,000) to Weikhard Corporation in...
Ambros transfers property (basis of $320,000 and fair market value of $210,000) to Weikhard Corporation in exchange for shares of § 1244 stock. Assume that the transfer qualifies under § 351. a. Assuming that Ambros and Weikhard do not make an election to reduce his stock basis, the basis of the stock to Ambros is $ .______ b. The basis of the stock to Ambros for purposes of § 1244 is $ ._________ c. If Ambros sells the stock for...
1.Explain the circumstances in which a corporation can use the accrual basis or the cash basis...
1.Explain the circumstances in which a corporation can use the accrual basis or the cash basis of accounting. 2.When must a corporate tax return be filed? Can a corporation receive an extension of time to file a return, and if so, what is the length of the extension? 3.An individual contributes property with a fair market value in excess of basis to a corporation un exchange for stock. What is the basis of the stock in the hands of the...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT