Identify Which of the Following Statements Is False

Identify which of the following statements is false.

A) Nonmoney property distributions made by an S corporation having accumulated E&P are treated differently when determining the corporate- level gain recognized under Sec. 311 than are property distributions made by an S corporation without accumulated E&P.
B) Tax- exempt income does not increase the AAA but increases the basis of the S corporation stock.
C) The AAA represents the cumulative income/loss recognized in post- 1982 S corporation years.
D) The AAA balance can be negative, but the shareholder's basis in the S corporation stock cannot be less than zero.