LO.6 Claude Bergeron sold 1,000 shares of Ditta, Inc., an S corporation located in C R I T I CAL THINKING Concord, North Carolina, for $9,000. He has a stock basis of $107,000 in the shares.

Assuming that Claude is single and that he is the original owner of these § 1244 stock shares, calculate the appropriate tax treatment of any gain or loss. If he sold the stock for

$201,000, could he obtain a 50% or 75% exclusion under § 1202 for one-half of the gain?

CRI T I CAL THINKING DECISION MAKING