A distribution in partial liquidation of a corporation is always treated as an exchange by an individual shareholder.

Question

Quizplus · Accepted Answer

According to the IRS, a distribution in partial liquidation of a corporation is generally considered an exchange by individual shareholders. This means that the shareholder may recognize gain or loss on the distribution, depending on the fair market value of the property received compared to the adjusted basis of the stock surrendered.

A Distribution in Partial Liquidation of a Corporation Is Always