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Don Juan, a single taxpayer, is the sole owner of DJ’s Inc., an S Corporation. This...

Don Juan, a single taxpayer, is the sole owner of DJ’s Inc., an S Corporation. This year, DJ’s Inc. incurred a massive $600,000 business loss, all of which is allocable to Don Juan as the sole shareholder. Assume that $600,000 loss is not limited by the basis, at-risk, or passive loss rules, and that Don Juan has no other business income or business losses. How much of the $600,000 loss will Don Juan be able to deduct this year? What happens to any loss not deducted this year?

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