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Mary is a shareholder in Carrollco, a calendar year S corporation. At the beginning of the year, her stock basis is $10,000, her share of
Mary is a shareholder in Carrollco, a calendar year S corporation. At the beginning of the year, her stock basis is $10,000, her share of the AAA is $2,000, and her share of corporate AEP is $6,000. At the end of the year, Mary receives from Carrollco a $6,000 cash distribution. Mary's share of S corporation items includes a $2,000 long- term capital gain and a $10,000 ordinary loss. Determine the effects of these events on Mary's share of the entity's AAA, her stock basis, and CarrollCo's AEP. If an item has no effect or an amount is zero, enter "0". Enter amounts as positive numbers. However, use the minus sign to indicate if a "balance" amount is negative. AAA Stock Basis AEP Beginning balance $2,000 $10,000 $6,000 Distribution -2,000 X -2,000 X -4,000 X Balance 0 8,000 $ -2,000 X LTCG 2,000 2,000 O Balance 2,000 10,000 $ 2,000 Loss -10,000 -10,000 0 Ending balance -8,000 0 $ 2,000
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