Yellow Corporation transfers land (basis of $120,000,fair market value of $260,000)to Joe,a shareholder,to carry out a qualified stock redemption.The land is distributed subject to a $150,000 liability.With respect to the redemption:

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Section 311 provides that corporations are taxed on all distributions of appreciated property whether in the form of a property dividend or a stock redemption.The amount of gain recognized is the excess of the property's fair market value (or associated debt relief,if greater)over Yellow's basis in the property,or $140,000 ($260,000 - $120,000).

Yellow Corporation Transfers Land (Basis of $120,000,fair Market Value of $260,000)to