Zeus owns 100% of Grecian Image Corporation and his basis in the stock is $105,000.He receives cash of $20,000 and property with FMV of $100,000 and basis of $140,000 in complete liquidation of his ownership interest.What amount of gain or loss should Zeus recognize as a result of this transaction?

Question

Quizplus · Accepted Answer

Zeus receives a total of $120,000 ($20,000 cash + $100,000 FMV of property) in liquidation. His basis in the stock is $105,000. The gain recognized is the difference between the amount received and the basis, which is $120,000 - $105,000 = $15,000 gain.

Zeus Owns 100% of Grecian Image Corporation and His Basis