All of the following would reduce the basis of a shareholder's stock in an S corporation,except
A)a shareholder's pro rata share of nontaxable distributions by the S corporation to its shareholders.
B)a shareholder's share of all loss and deduction items of the S corporation that are separately stated and passed through to the shareholder.
C)a shareholder's pro rata share of any nondeductible expenses of the S corporation.
D)a shareholder's pro rata share of loan repayments made by the S corporation.

Question

Quizplus · Accepted Answer

A shareholder's pro rata share of loan repayments made by the S corporation would not reduce the basis of their stock since it does not affect the income or deduction of the corporation. However, the other choices would reduce the basis of a shareholder's stock in an S corporation.

All of the Following Would Reduce the Basis of a Shareholder's