The stock in Palm Corporation is held equally by two brothers. One year before its liquidation,...
The stock in Palm Corporation is held equally by two brothers. One year before its liquidation, the shareholders transfer property (basis of $350,000, fair market value of $200,000) to Palm Corporation in return for stock. In a current year liquidation, Palm Corporation transfers the property (now worth $150,000) pro rata to the brothers. What amount of loss will Palm Corporation recognize on the distribution?
Homework Answers
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Zero Palm Corporation will not recognize any loss on the distribution of the property worth $150000 when it is transferred to the brothers on pro rata basis in the current year liquidation Comment if you face any issues |
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The stock in Palm Corporation is held equally by two brothers.
One year before its liquidation,...
Mary and Jane, unrelated taxpayers, own Gray Corporation’s stock equally. One year before the complete liquidation...
Mary and Jane, unrelated taxpayers, own Gray Corporation’s stock equally. One year before the complete liquidation of Gray, in a §351 transaction, Mary transfers land (basis of $200,000, fair market value of $130,000) to Gray Corporation as a contribution to capital. In liquidation, Gray distributes the land to Jane. At the time of the liquidation, the land is worth $140,000. How much loss, if any, may Gray Corporation recognize on the distribution of the land to Jane? a. $0 b....
The stock of Quail Corporation is held as follows: 85% by Pheasant Corporation and 15% by...
The stock of Quail Corporation is held as follows: 85% by Pheasant Corporation and 15% by Gisela, an individual. Quail Corporation is liquidated in December of the current year pursuant to a plan adopted earlier in the year. At the time of its liquidation, Quail Corporation has assets with a basis of $730,000 and fair market value of $1 million. Quail Corporation distributes the property pro rata to Pheasant Corporation and to Gisela. a. Compute Quail’s recognized gain or loss...
25. HolyCow Corporation is liquidated, with Sneha receiving $4,000 in money and other property having a...
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24. The stock of Delaney Corporation is 70% owned by Richard and 30% owned by Richard's...
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Problem 20-29 (LO. 1, 4) Pink Corporation acquired land and securities in a § 351 tax-free exchange. On the date of the transfer, the land had a basis of $720,000 and a fair market value of $630,000, and the securities had a basis of $110,000 and a fair market value of $250,000. Pink Corporation has two shareholders, Maria and Paul, who are unrelated. Maria owns 85% of the stock in The Corporation, and Paul owns 15%. Pink adopts a plan...
Rachel owns 100% of the stock of Cardinal Corporation. In the current year Rachel transfers an...
Rachel owns 100% of the stock of Cardinal Corporation. In the current year Rachel transfers an installment obligation, tax basis of $180,000 and fair market value of $350,000, for additional stock in Cardinal worth $350,000. a. Rachel has a taxable gain of $170,000. b. Rachel recognizes no gain on the transfer. c. Rachel has a taxable gain of $180,000 d. Rachel has a basis of $350,000 in the additional stock she received in Cardinal Corporation Os. None of these choices...
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....
19. Geranova Corporation is liquidated, with Vlad receiving $7,500 in money, other property having a $5,000...
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Exercise 20-13 (LO. 1) Pursuant to a complete liquidation, Carrot Corporation distributes to its shareholders real...
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22. Under a plan of complete liquidation, Cain Corporation distributes land (not a property) with an adjusted basis of $410,000 and an FMV of $300,000 for all Gary's stock. Gary's basis in his 10% interest in the Cain stock is $250.000. Find Gary's basis in the land and Cain Corporation's recognized gain or loss. A) Recognized Gain/Loss $110,000 loss Recognized Gain/Loss $110,000 loss Basis $300,000 B) Basis $250,000 C) Basis $300,000 D) Basis $250,000 Recognized Gain/Loss SO Recognized Gain/Loss SO...
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