AS150.000 ; Rosie's basis in property 8 S80,000 in property B ty AS150,000; Rosie's basis in property B S00,000 ty A$720,000: Rosie's basis in property B S0,000 A$200.000 Roie's basis in property B S0,000
AS150.000 ; Rosie's basis in property 8 S80,000 in property B ty AS150,000; Rosie's basis in property B S00,000 ty A$720,000: Rosie's basis in property B S0,000 A$200.000 Roie's basis in property B S0,000
Chapter6: Corporations: Redemptions And Liquidations
Section: Chapter Questions
Problem 33CE
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Question
Transcribed Image Text:ABC Corporation (ABC Jowns 90N of the single class of stock in Subsidiary Corporation. The other 10% is owned by Rosie, an individual. ABC's basis in its Subsidiary stock is $ 200,000
and Rosie's basis is Se0,000. Subsidiary distributes property A having an adjusted basis of $150,000 and an FMV of $720.000 to ABC, and property B with a FMV of $80,000 and an
adjusted besis of S60,000 to Rosie in a liquidating distribution. Subsidary had $10 million of eamings and profts at the date of liquidetion.
What basis do ABC and Rosie have in the property received in the liquidating distribuion ?
OA ABC basis in property A $150,000 ; Ronie's basis in property B S80,000 in property B
B. ABC's basis in property A $150,000; Rosie's basis in property B S00,000
OC. ABC's basis in property A $720,000; Rosie's basis in property B S80,000
OD. ABC basis in property A $200.000 Rosie's basis in property B S0,000
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