McGraw-Hill's Taxation of Individuals and Business Entities 3rd Edition by Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

تمرين 20

Alabama Corporation, an S corporation, liquidates this year by distributing a parcel of land to its sole shareholder, Mark Ingram.The fair market value of the parcel is $50,000 and its tax basis is $30,000.Mark's basis in his stock is $25,000.a.What amount of gain or loss, if any, does Alabama Corporation recognize on the distribution?
b.How much gain must Mark recognize (if any) as a result of the distributionand what is his basis in the land?
c.What is your answer to (a) if the fair market value of the land is $20,000 rather than $50,000?
d.What is your answer to (b) if the fair market value of the land is $20,000 rather than $50,000?