You are given the following facts about a 50% owner of an S corporation. Compute her ending stock basis. $$\begin{array} { l r }
\text { Increase in AAA } & \$ 32,000 \
\text { Increase in OAA } & 6,300 \
\text { Payroll tax penalty } & 2,140 \
\text { Owner's beginning stock basis } & 39,800 \
\text { Tax-exempt interest income } & 4,800 \
\text { Insurance premiums paid (nondeductible) } & 2,700 \
\text { Owner's additional stock purchases } & 22,000 \
\text { Owner's 20\% QBI deduction } & 21,000
\end{array}$$

Question

You are given the following facts about a 50% owner of an S corporation. Compute her ending stock basis. $$\begin{array} { l r } 
\text { Increase in AAA } & \$ 32,000 \
\text { Increase in OAA } & 6,300 \
\text { Payroll tax penalty } & 2,140 \
\text { Owner's beginning stock basis } & 39,800 \
\text { Tax-exempt interest income } & 4,800 \
\text { Insurance premiums paid (nondeductible) } & 2,700 \
\text { Owner's additional stock purchases } & 22,000 \
\text { Owner's 20\% QBI deduction } & 21,000
\end{array}$$

Quizplus · Accepted Answer

The ending stock basis is computed as follows:Beginning stock basis $39,800Increase in AAA 32,000Increase in OAA 6,300Payroll tax penalty 2,140Tax-exempt interest income 4,800Insurance premiums paid (nondeductible) 2,700Owner's additional stock purchases 22,000Owner's 20% QBI deduction 21,000Ending stock basis $80,950

You Are Given the Following Facts About a 50% Owner