Spencer owns 50% of the stock of Crossbill Corporation, a calendar year taxpayer that has elected Subchapter S status. As of January 1, 2017, Spencer's basis in the stock is $40,000. Crossbill has an operating loss of $100,000 for 2017 and taxable income of $60,000 for 2018.
a.What should Spencer report for 2017?
b.What should Spencer report for 2018?
c.What is Spencer's basis in Crossbill Corporation stock as of January 1, 2018? As of January 1, 2019?

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The Answer of Spencer owns 50% of the stock of Crossbill Corporation, a calendar year taxpayer that has elected Subchapter S status. As of January 1, 2017, Spencer's basis in the stock is $40,000. Crossbill has an operating loss of $100,000 for 2017 and taxable income of $60,000 for 2018.
a.What should Spencer report for 2017?
b.What should Spencer report for 2018?
c.What is Spencer's basis in Crossbill Corporation stock as of January 1, 2018? As of January 1, 2019?

Spencer Owns 50% of the Stock of Crossbill Corporation, a Calendar