one caldar years corporation in Denton, Texas, has two unrelated shareholders, each owning 50% of the stock. Both darations and $400,000 stock basis as of January 1. At the beginning of the tax year, Money reports balances in AAA of $300,000 - and of $500 During the year, Money generates operating income of $100,000. At the end of the year, Money distributes securities $100.000, with an adjusted basis of $800,000. the two dharafelders consent to an AAA bypass election. What is the Federal income tax effects of these transactions for the shareholders? If an amount is zero, enter "0". taxable distribution and a $ at the end of the year, and each shareholder's basis is $ tax-free distribution from AAA. The AAA is AEP is reduced to $

SWFT Corp Partner Estates Trusts
42nd Edition
ISBN:9780357161548
Author:Raabe
Publisher:Raabe
Chapter12: S Corporations
Section: Chapter Questions
Problem 36P
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Moriny, na calendar years corporation in Denton, Texas, has two unrelated shareholders, each owning 50% of the stock. Both
akarationers and a $400,000 stock basis as of January 1. At the beginning of the tax year, Money reports balances in AAA of $300,000 -
and XP of $500,000 Dering the year, Money generates operating income of $100,000. At the end of the year, Money distributes securities
worth $199.900, with an adjusted basis of $800,000.
the two shareholders consent to an AAA bypass election.
What is the Federall income tax effects of these transactions for the shareholders? If an amount is zero, enter "0".
taxable distribution and a $
at the end of the year, and each shareholder's basis is $
tax-free distribution from AAA. The AAA is
. AEP is reduced to $
Transcribed Image Text:Moriny, na calendar years corporation in Denton, Texas, has two unrelated shareholders, each owning 50% of the stock. Both akarationers and a $400,000 stock basis as of January 1. At the beginning of the tax year, Money reports balances in AAA of $300,000 - and XP of $500,000 Dering the year, Money generates operating income of $100,000. At the end of the year, Money distributes securities worth $199.900, with an adjusted basis of $800,000. the two shareholders consent to an AAA bypass election. What is the Federall income tax effects of these transactions for the shareholders? If an amount is zero, enter "0". taxable distribution and a $ at the end of the year, and each shareholder's basis is $ tax-free distribution from AAA. The AAA is . AEP is reduced to $
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