Noelle, the owner of all of the shares of ClockCo, an S corporation, transfers her stock to Grayson on April1. ClockCo reports a $75,000 NOL for the entire tax year, but only $11, 250 of the loss occurs duringJanuary-MarchAssume 365 days in a year. Round per day computations to five decimal places. Round final answers tothe nearest dollar.Without a short - year election, how much of the loss is allocated to Noelle and how much is allocated toGrayson?Noelle's loss allocation: $fill in the blank 1(wrong answer 56,507)Grayson's loss allocation: Sfill in the blank 2(wrong answer 18, 493)If the corporation makes the short-year election, how much of the loss is allocated to Grayson?Sfill in the blank 363,750 (correct answer)

Noelle's loss allocation= 75,000 * (91 / 365) = 75,000 * 0.24932= $18,699 Grayson's loss allocation=…

Answered: Noelle, the owner of all of the shares…

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter22: S Corporations

Section: Chapter Questions

Problem 18CE

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