On January $1,2022,$ Leo paid $$24,400$ for $5$ percent of the stock in BLS$,$ an S corporation. In November, he loaned $$9,750$ to BLS in return for a promissory note. BLS generated a $$754,000$ operating loss in $2022.$

Required:

How much of his share of the loss can Leo deduct on his $2022$ return? Assume the excess business loss limitation does not apply.

Compute Leo$$s basis in his BLS stock and his BLS note at the end of $2022.$

Answer rating: 100% (QA)

1 Basis in BLS Stock Leo paid 24400 for 5 of the stock in BLS This means the total value of BLS at t... View the full answer