Lynn transfers property with a basis of $25,000 and a fair market value of $5,000 to Green Corporation in exchange for shares of 1244 stock, in an exchange that qualifies under 351. Lynn sells the stock in the current year for $3,000. With respect to the sale,

1. Lynn will have an ordinary loss deduction of $22,000.
2. Lynn will have a capital loss of $22,000.
3. Lynn will have an ordinary loss of $20,000 and a capital loss of $2,000.
4. Lynn will have an ordinary loss of $2,000 and a capital loss of $20,000.