At the beginning of the tax year, Zach's basis for his partnership interest was $30,000. His share of partnership items for the year consisted of an ordinary loss of $44,000 and a capital gain of $2,000. He also received a distribution from the partnership of $20,000 cash during the year. For the tax year, Zach will report:

		A nontaxable distribution of $20,000, an ordinary loss deduction of $10,000, and a suspended loss carryforward of $34,000.
		A nontaxable distribution of $20,000, an ordinary loss deduction of $12,000, and a suspended loss carryforward of $32,000.
		An ordinary loss deduction of $32,000, a suspended loss carryforward of $12,000, and a taxable capital gain of $20,000.
		An ordinary loss deduction of $44,000 and a nontaxable distribution of $20,000.