Clampett, Inc. has been an S corporation since its inception. On July 15, 2018, Clampett, Inc. distributed $50,000 to J. D. His basis in his Clampett, Inc. stock on January 1, 2018, was $45,000. For 2018, J. D. was allocated $10,000 of ordinary income from Clampett, Inc. and no separately stated items. What is the amount of income J. D. recognizesrelated to Clampett, Inc. in 2018?

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J. D. has already been allocated $10,000 of ordinary income from Clampett, Inc. for 2018. The distribution of $50,000 reduces J. D.'s basis in his stock to $0, but any amount over his basis is considered a capital gain. Since J. D. only received $5,000 more than his basis, he recognizes a capital gain of $5,000, and his total recognized income for 2018 related to Clampett, Inc. is $15,000 ($10,000 of ordinary income + $5,000 of capital gain).