Taxpayer contributes $4,000 in cash to C-Corporation. Before the company has generated any income, earnings or revenue, Taxpayer receives $2,000 back from the corporation. Taxpayer should treat the $2,000 he received back from the corporation as: a. Dividend b. 1231 Gain c. Non-taxable return of capital d. Capital Gain.
Taxpayer contributes $4,000 in cash to C-Corporation. Before the company has generated any income, earnings or revenue, Taxpayer receives $2,000 back from the corporation. Taxpayer should treat the $2,000 he received back from the corporation as: a. Dividend b. 1231 Gain c. Non-taxable return of capital d. Capital Gain.
Chapter4: Corporations: Organization And Capital Structure
Section: Chapter Questions
Problem 42P
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8 Taxpayer contributes $4,000 in cash to C-Corporation. Before the company has generated any income, earnings or revenue, Taxpayer receives $2,000 back from the corporation.
Taxpayer should treat the $2,000 he received back from the corporation as:
a. Dividend
b. 1231 Gain
c. Non-taxable return of capital
d.
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