Samantha Tynsdale loaned S&S Home Cleaning, Inc. $2,500. If she takes a distribution of $500 in 2024, how will that affect her basis? 1. Her stock basis will decrease by $500, but her debt basis will remain $2,500. 2. 3. Her stock basis will not be impacted, but her debt basis will decrease by $500. Her stock basis will decrease by $250 and her debt basis will decrease by $250. 4. There will be no impact to her basis if she takes a distribution of $500.
Samantha Tynsdale loaned S&S Home Cleaning, Inc. $2,500. If she takes a distribution of $500 in 2024, how will that affect her basis? 1. Her stock basis will decrease by $500, but her debt basis will remain $2,500. 2. 3. Her stock basis will not be impacted, but her debt basis will decrease by $500. Her stock basis will decrease by $250 and her debt basis will decrease by $250. 4. There will be no impact to her basis if she takes a distribution of $500.
Chapter6: Business Expenses
Section: Chapter Questions
Problem 89TPC
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Transcribed Image Text:Samantha Tynsdale loaned S&S Home Cleaning, Inc. $2,500. If she takes a distribution of $500 in 2024, how will that
affect her basis?
1. Her stock basis will decrease by $500, but her debt basis will remain $2,500.
2.
3.
Her stock basis will not be impacted, but her debt basis will decrease by $500.
Her stock basis will decrease by $250 and her debt basis will decrease by $250.
4.
There will be no impact to her basis if she takes a distribution of $500.
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