Clampett, Inc. has been an S corporation since its inception. On July 15, 2017, Clampett, Inc. distributed $50,000 to J. D. His basis in his Clampett, Inc. stock on January 1, 2017, was $45,000. For 2017, 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. recognizes related to Clampett, Inc. in 2017?

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J. D. recognizes $10,000 of income, which is the ordinary income allocated to him from Clampett, Inc. The distribution reduces his stock basis but does not result in additional income recognition since his basis after the income allocation ($55,000) is greater than the distribution ($50,000).