Sherburne Corporation reported current earnings and profits for year 1 of $500,000.During the year, the company made a distribution of land to its sole shareholder, Ted Bozeman.The land's fair market value was $150,000 and its tax and E&P basis to Sherburne was $100,000.Ted assumed a mortgage attached to the land of $25,000.What amount of dividend income does Ted report as a result of the distribution and what is Ted's income tax basis in the land received from Sherburne?

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The Answer of Sherburne Corporation reported current earnings and profits for year 1 of $500,000.During the year, the company made a distribution of land to its sole shareholder, Ted Bozeman.The land's fair market value was $150,000 and its tax and E&P basis to Sherburne was $100,000.Ted assumed a mortgage attached to the land of $25,000.What amount of dividend income does Ted report as a result of the distribution and what is Ted's income tax basis in the land received from Sherburne?

Sherburne Corporation Reported Current Earnings and Profits for Year 1