Orange, Inc., a calendar year corporation in Clemson, South Carolina, elects S corporation status for...
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Orange, Inc., a calendar year corporation in Clemson, South Carolina, elects S corporation status for 2019. The company generated a $388,000 NOL in 2018 and another NOL of $232,800 in 2019. Orange stock always is owned by the same four shareholders, each owning 25% of the stock. Pete, one of the shareholders, holds a $31,040 basis in this Orange stock at the beginning of 2019.
Complete the statement below that outlines the Federal income tax issues that Pete faces.
The 2018 C corporation NOL of $388,000 _______________ (carries/does not carry) forward into the S corporation year. Therefore, the deductible loss in 2019 by Pete is $________, with $________ carryover.
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