Chapter 15 corporate nonliquidating distributions brisbane dating agency scams

91) Ace Corporation has a single class of stock outstanding.Alan owns 200 shares of the common stock, which he purchased for per share two years ago.Christine’s tax basis in her Jayhawk stock is ,000. How much of the 0,000 distribution is treated as a dividend to Christine? [LO2] This year Sooner Company reports current E&P of negative 0,000.Its accumulated E&P at the beginning of the year was 0,000. How much of the 0,000 distribution is treated as a dividend to Boomer? [LO2] Blackhawk Company reports current E&P of negative 0,000.12) Two corporations are considered to be brother-sister corporations for purposes of the Sec.304 redemption rules if one shareholder owns more than 50% of each corporation.On April 10, of the current year, Ace Corporation distributes to its shareholders one right to purchase a share of common stock at per share for each share of common stock held.

d) What is the amount and character of gain or loss Alan recognizes when he sells the new common stock?

The bonus meets the requirements to be “reasonable” and is therefore deductible by Bulldog.

Georgia is subject to a marginal tax rate of 35% on the bonus.

a) What is the amount and character of income Alan recognizes when he receives the rights?

b) What is the amount and character of gain or loss Alan recognizes when he sells the rights?

Leave a Reply