On January 1, 2017, Leo paid $15,000 for 5 percent of the stock in BLS,...
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Accounting
On January 1, 2017, Leo paid $15,000 for 5 percent of the stock in BLS, an S corporation. In November, he loaned $8,000 to BLS in return for a promissory note. BLS generated a $600,000 operating loss in 2017.
How much of his share of the loss can Leo deduct on his 2017 return?
Assume the excess business loss limitation does not apply. Compute Leos basis in his BLS stock and his BLS note at the end of 2017.
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