T corporation (E & P $800,000) has 1,000 shares of stock outstanding. The shares are owned as followed: James 600 shares; Stephanie (James's sister) 300 shares; Luke (James son) 100 shares. T corporation owns land (basis of 300,000, FMV of $260,000) that it purchased as an investment 10 years ago. James had a basis of $275,000 in his shares. What are the tax consequences for both T corporation and James if the distribution is: A. A qualified stock redemption B. A liquidating distribution
T corporation (E & P $800,000) has 1,000 shares of stock outstanding. The shares are owned as followed: James 600 shares; Stephanie (James's sister) 300 shares; Luke (James son) 100 shares. T corporation owns land (basis of 300,000, FMV of $260,000) that it purchased as an investment 10 years ago. James had a basis of $275,000 in his shares. What are the tax consequences for both T corporation and James if the distribution is: A. A qualified stock redemption B. A liquidating distribution
Chapter19: Corporations: Distributions Not In Complete Liquidation
Section: Chapter Questions
Problem 57P
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ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT