Dumbledore Corporation was formed on January 1, 2017. Mr. Smith owns 25% of the corporation's stock. The corporation made an S election immediately, and it is a calendar-year corporation. Mr. Smith contributed $15,000 cash to Dumbledore in exchange for his stock. On August 8, 2017, Dumbledore Corporation borrowed $22,000 from Mr. Smith, and $10,000 from First National Bank under a recourse financing arrangement. Dumbledore had losses from its operations of $104,000 in 2017 and $82,000 in 2018. At the end of 2018, Dumbledore Corporation had not repaid any of the loans from Mr. Smith or the bank. What part of Dumbledore Corporation's 2018 loss may Mr. Smith report on his 2018 individual tax return?