• Parsons Inc. is owned equally by Claudette and James Parsons. They each own 1,000 shares of stock. Claudette would like to redeem 500 shares of stock for $50,000 per share. The company’s current E&P is $8,000,000 and accumulated E&P is $40,000,000. Claudette’s basis in the stock is $10,000 per share. One slight problem in all of this is that Claudette and James have separated (although not legally) and they refuse to speak to each other or communicate other than through their attorney and you, their accountant. Claudette would like to know how the redemption will be treated for tax purposes, including her remaining basis in the other 500 shares of stock. Please show calculation of the tax basis to the 500 remaining shares