Question

Citrus Corporation is a calendar year S corporation with the following current year information: Operating loss Liabilities: Notes payable, Big Apple Bank Notes payable, Grapefruit (individual) $(360,000) \$60,000 60,000 On January 1, Orange (an individual) bought 50% of Citrus Corporation stock for $90,000. How much of the operating loss may Orange deduct currently? Assume the excess business loss limitation does not apply. $150,000 $90,000 $180,000 $120,000

          Citrus Corporation is a calendar year S corporation with the following current
year information:
Operating loss
Liabilities:
Notes payable, Big Apple Bank
Notes payable, Grapefruit (individual)
$(360,000)
\$60,000
60,000
On January 1, Orange (an individual) bought 50% of Citrus Corporation stock
for $90,000. How much of the operating loss may Orange deduct currently?
Assume the excess business loss limitation does not apply.
$150,000
$90,000
$180,000
$120,000