John is the sole shareholder of Maggy Corporation, a qualified D corporation. At January 1, Year 1, John has a basis in Maggy Corporation of $2000. The corporation’s Year 1 tax return shows the following: Ordinary income $10,000 Interest income $1,000 Nondeductible expenses $2,000 Real estate rental loss $5,000 179 deduction $1,500 Distribution to John $3,000
John is the sole shareholder of Maggy Corporation, a qualified D corporation. At January 1, Year 1, John has a basis in Maggy Corporation of $2000. The corporation’s Year 1 tax return shows the following: Ordinary income $10,000 Interest income $1,000 Nondeductible expenses $2,000 Real estate rental loss $5,000 179 deduction $1,500 Distribution to John $3,000
Chapter13: Choice Of Business Entity—general Tax And Nontax Factors/formation
Section: Chapter Questions
Problem 40P
Related questions
Question
- John is the sole shareholder of Maggy Corporation, a qualified D corporation. At January 1, Year 1, John has a basis in Maggy Corporation of $2000. The corporation’s Year 1 tax return shows the following:
Ordinary income $10,000
Interest income $1,000
Nondeductible expenses $2,000
Real estate rental loss $5,000
179 deduction $1,500
Distribution to John $3,000
What is John’s basis in Maggy Corporation at the end of year 1?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you