Brad owns 100 shares of AAA Corporation with a basis of $6,000 and a FMV of $24,000. Brad receives 15 stock rights as a nontaxable distribution with a total FMV of $6,000. Brad allows the stock rights to expire. Brad's loss recognized and the basis of the original 100 shares after expiration of the stock rights is
A) $0 and $4,800.
B) $0 and $6,000.
C) ($1,200) and $4,800.
D) ($1,200) and $6,000.
B) $0 and $6,000.
If the stock rights expire, no loss is recognized and any basis allocated to the rights is reallocated back to the stock.
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