True or False. A calendar-year corporation has negative current E&P of $100 and accumulated E&P of $100.

Question:

True or False. A calendar-year corporation has negative current E&P of $100 and accumulated E&P of $100. A cash distribution of $100 to the corporation's sole shareholder on June 30 will not be treated as a dividend because total E&P at December 31 is $0. Explain.

Fantastic news! We've Found the answer you've been seeking!