See guide for #$3$ #$8$ which appears after $711.$ The guide shows in chronological order what is happering in these problems. IN$.$ADDITION. TRACK MARYS BASIS IN STOCKILDANS FOR EACH YEAR.

$3.$ Mary manages S Corp and owns $100\%$ of the stock. On January $1,2023.$ Mary's basis in the stock is $$70,000.$ For the year $20235$ Copp had a loss of $$100,000.$ How will Mary treat her share of the loss on her $2023$ income tax return?

$4.$ Refer to question $3$ above. In $2024,5$ Corporation had income of $$40,000.$ How will Mary treat her share of the income on her $2024$ income tax return.

$5.$ Refer to question $3$ above. Assume Mary had also loaned the S Corp $$20,000$ on January $1,2023.$ The loan is evidenced by a note. Given the facts in question $3,$ how will Mary treat her share of the loss on her $2023$ income tax return?

$6.$ Refer to question $5$ above. On January $1,2024$ the $ Corp repays the $$20,000$ loan to Mary. S Corp "breaks even" in $2024($no income or loss$).$ What must Mary report on her $2024$ income tax return, if anything?