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Riley, a 50% S corporation shareholder, began the year with a stock basis of $100,000 and, during the year, directly loan the S corporation $50,000.

  1. Riley, a 50% S corporation shareholder, began the year with a stock basis of $100,000 and, during the year, directly loan the S corporation $50,000. Ordinary business loss for the year was $360,000. How much stock and debt basis does Riley have at the end of the year?

    1. $0 stock basis; $0 debt basis

    2. $0 stock basis; ($30,000) debt basis

    3. $(30,000) stock basis; $0 debt basis

    4. $0 stock basis; $20,000 debt basis


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