Dried Fruit Corp. has had a valid S Corp election in effect at all times since its incorporation. The Dried Fruit Corp. stock is owned one-third by Raisin and two-thirds by Prune. All shareholders are US resident citizen individuals. At the beginning of the current year, Raisin's basis in his shares was $99,000 and Prune's basis in her shares was $33,000. During the current year, Dried Fruit Corp. earned $594,000 of net income from operations. Raisin's share was $198,000; Prune's share was $396,000. On July 1st, Dried Fruit Corp. distributed $264,000 to Raisin and $528,000 to Prune. How much gain does Raisin recognize as a result of this transaction? $66,000 $99,000 O $0 $33,000
Dried Fruit Corp. has had a valid S Corp election in effect at all times since its incorporation. The Dried Fruit Corp. stock is owned one-third by Raisin and two-thirds by Prune. All shareholders are US resident citizen individuals. At the beginning of the current year, Raisin's basis in his shares was $99,000 and Prune's basis in her shares was $33,000. During the current year, Dried Fruit Corp. earned $594,000 of net income from operations. Raisin's share was $198,000; Prune's share was $396,000. On July 1st, Dried Fruit Corp. distributed $264,000 to Raisin and $528,000 to Prune. How much gain does Raisin recognize as a result of this transaction? $66,000 $99,000 O $0 $33,000
Chapter22: S Corporations
Section: Chapter Questions
Problem 36P
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Transcribed Image Text:Dried Fruit Corp. has had a valid S Corp election in effect at all times since
its incorporation. The Dried Fruit Corp. stock is owned one-third by Raisin
and two-thirds by Prune. All shareholders are US resident citizen
individuals. At the beginning of the current year, Raisin's basis in his shares
was $99,000 and Prune's basis in her shares was $33,000. During the
current year, Dried Fruit Corp. earned $594,000 of net income from
operations. Raisin's share was $198,000; Prune's share was $396,000. On
July 1st, Dried Fruit Corp. distributed $264,000 to Raisin and $528,000 to
Prune. How much gain does Raisin recognize as a result of this
transaction?
O $66,000
$99,000
O $0
$33,000
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