Parrot,Inc. ,a C corporation,distributes $300,000 to its shareholder,Jerome,and land worth $300,000 (adjusted basis of $180,000)to its shareholder,Peggy.Parrot has earnings and profits of $650,000.Determine the tax consequences to Parrot,Jerome,and Peggy.

Question

Quizplus · Accepted Answer

The Answer of Parrot,Inc. ,a C corporation,distributes $300,000 to its shareholder,Jerome,and land worth $300,000 (adjusted basis of $180,000)to its shareholder,Peggy.Parrot has earnings and profits of $650,000.Determine the tax consequences to Parrot,Jerome,and Peggy.