Jennelle and Paula are equal partners in the J&P Manufacturing Partnership. The partnership will form J&P Corporation

Question:

Jennelle and Paula are equal partners in the J&P Manufacturing The will form J&P by exchanging the assets and liabilities of the J&P Manufacturing for all the corporation’s stock on September 1 of the current year. The then will liquidate by distributing the J&P stock equally to Jennelle and Paula. Both shareholders use the calendar year as their tax year and desire that the make an S election. What tax issues should Jennelle and Paula consider with respect to the incorporation?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...