Stephanie Owns a 25% Interest in a Qualifying S Corporation

Multiple Choice

Stephanie owns a 25% interest in a qualifying S corporation. Stephanie's basis in the stock was $40,000 at the beginning of the year. Stephanie made no capital contributions and received no distributions during the year. Stephanie loaned the S corporation $10,000 this year. The S corporation incurred a $240,000 ordinary loss this year. Stephanie's deduction and carryover of the unused loss are

A) $30,000 and $30,000.
B) $40,000 and $20,000.
C) $50,000 and $10,000.
D) $60,000 and $0.