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Orange, Inc., a calendar year corporation, elects S corporation status for 2022. The company generated a $74,000 NOL in 2021

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Orange, Inc., a calendar year corporation, elects S corporation status for 2022. The company generated a $74,000 NOL in 2021 and another NOL of $43,000 in 2022. Orange recorded no other transactions for the year.

At all times in 2021 and 2022, the stock of the corporation is owned by the same four shareholders, each owning 25% of the stock. Pete, one of the shareholders, holds a $6,020 basis in the Orange stock at the beginning of 2022. Identify the Federal income tax issues that Pete faces.

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The 2021 C corporation NOL of 74 000 does not carry forward …View the full answer


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Related Book For  answer-question
South Western Federal Taxation 2023 Comprehensive Volume

South Western Federal Taxation 2023 Comprehensive Volume

ISBN: 9780357719688

46th Edition

Authors: Annette Nellen, Andrew D. Cuccia, Mark Persellin, James C. Young

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Question Details
Chapter # 22- S Corporations
Section: Discussion Questions
Problem: 48
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Question Posted: September 24, 2023 07:51:51
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