Final answer:
Section 1244 ordinary loss treatment is available only to individuals who invest in small business stock, allowing them to deduct a loss as an ordinary loss which can offset ordinary income.The correct answer is option A.
Step-by-step explanation:
Section 1244 ordinary loss treatment is a provision in the United States tax code that allows taxpayers to deduct a loss on a small business stock as an ordinary loss rather than a capital loss.
This can be advantageous because ordinary losses can be used to offset ordinary income without the limitations placed on capital losses. According to the Internal Revenue Code (IRC), the loss treatment stated in Section 1244 is available to individuals who invest in small business stock.
The corporations that issue the stock receive money, but it is the individual investors who may claim the loss. Consequently, when considering who is allowed to receive Section 1244 ordinary loss treatment, the correct answer is:
a. Only individuals
It is important for students of business and individuals involved in business investments to understand the implications of IRS codes on their potential tax deductions.The correct answer is option A.