A stock redemption is treated as a sale or exchange of the shares if the shareholder...
A stock redemption is treated as a sale or exchange of the shares if the shareholder whose shares are redeemed is a corporation. True or False
Homework Answers
Ans:True
Explanation:
A stock redemption is treated as a sale or exchange of the shares if the shareholder whose shares are redeemed is a corporation.
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A stock redemption is treated as a sale or exchange of the
shares if the shareholder...
A) Indicate if Sal Might be able to receive sale or exchange treatment. B) Indicate the tax consequences to Sal if the redemption is treated as a dividend or if it is treated as a sale or exchange.
Samson Corporation has 1,000 shares of common stock outstanding. Sal owns 560 shares, Rita owns 250, Shares, Susan owns 190 shares. None of the owners are related. On Aug. 14 Samson redeemed 150 shares from Sal. Sal's adjusted basis in the 560 shares was 28,000. In return for the 150 shares, Sal recieved $17,000. Samsons Current E&P was 45,000. Sal perfers to receive sale or exchange treatment.A) Indicate if Sal Might be able to receive sale or exchange treatment.B) Indicate...
For a stock redemption to qualify for sale or exchange treatment under Section 303 (redemptions to...
For a stock redemption to qualify for sale or exchange treatment under Section 303 (redemptions to pay estate taxes), it must satisfy the Section 302 redemption provisions. (True or False)
Z-Sisters Corporation has one class of voting common stock, of which 1,000 shares are issued and...
Z-Sisters Corporation has one class of voting common stock, of which 1,000 shares are issued and outstanding. The shares are owned as follows: Shares Lourdes Vick 400 Anita Vick (Lourdes’s daughter) 200 Liz Vick (Lourdes’s daughter) 200 Cat Labrillazo (unrelated) 200 Total 1000 Z-Sisters Corporation has current E&P of $300,000 for this year and accumulated E&P at January 1 of this year of $500,000. During this year, the corporation made the following distributions to its shareholders: 03/31: Paid a dividend...
A person who performs services for a corporation in exchange for stock will be treated as...
A person who performs services for a corporation in exchange for stock will be treated as a member of the transferring group even if that person only transfers a relatively small amount of property to the corporation. True or False
Tax Drill - Disproportionate Redemption Complete the following statements regarding disproportionate redemptions. A stock redemption qualifies...
Tax Drill - Disproportionate Redemption Complete the following statements regarding disproportionate redemptions. A stock redemption qualifies for sale or exchange treatment under $ 302(b)(2) as a disproportionate redemption if the following conditions are met: % of the interest owned in the corporation before the • After the distribution, the shareholder owns less than redemption . After the distribution, the shareholder owns less than entitled to vote. % of the total combined voting power of all dasses of stock Tax Drill...
A person who performs services for a corporation in exchange for stock cannot be treated as...
A person who performs services for a corporation in exchange for stock cannot be treated as a member of the transferring group even if that person also transfers some property to the corporation. True False
To carry out a qualifying stock redemption, Turaco Corporation (E & P of $800,000) transfers land...
To carry out a qualifying stock redemption, Turaco Corporation (E & P of $800,000) transfers land held for investment purposes to Aida, a shareholder. The land had a basis of $250,000, a fair market value of $400,000, and is subject to a $300,000 liability. Aida has a basis of $70,000 in the shares redeemed. Which of the following is a correct statement regarding the tax consequences of this redemption? a. Aida will have $400,000 of dividend income. b. Aida will...
gift of stock by a shareholder to a family member 21. Shareholder A sold 500 shares...
gift of stock by a shareholder to a family member 21. Shareholder A sold 500 shares of ABC stock on the New York Stock Exchange. This transaction: A. took place in the primary market. occurred in a dealer market. B. was facilitated in the secondary market. involved a proxy. was a private placement. C. D. E.
A & W corporation is owned as follows (800 shares issues and outstanding): Mr. B Sr....
A & W corporation is owned as follows (800 shares issues and outstanding): Mr. B Sr. 25% (200 shares) Mr. C Sr. (B's brother) 25% (200 shares) Mrs. B (B Sr.'s wife) 10% (80 shares) Mr. B Jr. 10% 80 shares) Mr. C. Jr. 15% (120 shares) Mrs. C (CSr.'s wife) ( 40 shares) Darrel (Mr. C Sr.'s grandson) 10% 80 shares) TOTAL 100% 5% " Determine the (1) amount and (2) character of a redemption on the shareholder if...
Question 1 Which of the following is an incorrect statement regarding the tax consequences of a...
Question 1 Which of the following is an incorrect statement regarding the tax consequences of a § 306 stock disposition? In a sale of § 306 stock, the shareholder generally recognizes ordinary income equal to the fair market value of the preferred stock on the date it was acquired in the stock dividend. No loss is recognized on a sale of § 306 stock. The issuing corporation’s E & P is not reduced by a sale of § 306 stock....
Tax Drill - Disproportionate Redemption Complete the following statements regarding disproportionate redemptions. A stock redemption qualifies for sale or exchange treatment under $ 302(b)(2) as a disproportionate redemption if the following conditions are met: % of the interest owned in the corporation before the • After the distribution, the shareholder owns less than redemption . After the distribution, the shareholder owns less than entitled to vote. % of the total combined voting power of all dasses of stock Tax Drill...
A person who performs services for a corporation in exchange for stock cannot be treated as a member of the transferring group even if that person also transfers some property to the corporation. True False
gift of stock by a shareholder to a family member 21. Shareholder A sold 500 shares of ABC stock on the New York Stock Exchange. This transaction: A. took place in the primary market. occurred in a dealer market. B. was facilitated in the secondary market. involved a proxy. was a private placement. C. D. E.
A & W corporation is owned as follows (800 shares issues and outstanding): Mr. B Sr. 25% (200 shares) Mr. C Sr. (B's brother) 25% (200 shares) Mrs. B (B Sr.'s wife) 10% (80 shares) Mr. B Jr. 10% 80 shares) Mr. C. Jr. 15% (120 shares) Mrs. C (CSr.'s wife) ( 40 shares) Darrel (Mr. C Sr.'s grandson) 10% 80 shares) TOTAL 100% 5% " Determine the (1) amount and (2) character of a redemption on the shareholder if...
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