1. 10 friends form an S Corporation named Diamond in year 2019 and contribute $10,000 each. Assume there are no nonresident aliens in this corporation. In the year 2019, Jason and Hellen, starts taking distributions of $15,000 each without receiving any reasonable salary. Both these shareholders devote almost 100% of their time to this business. Please describe in detail, the tax implications on this distribution to the company and to the shareholders. Assume the business made money and has positive AAA account balance. explain in detail

2. Roxanne starts the new business and she needs your help. She thinks she pays too much in taxes. She needs limited liability protection for her business but also does not want to spend too much time in incorporation and administrative expenses. She has no business partner and her husband helps her in the business. She thinks she may need capital in the future and therefore an additional business partner may be needed. She estimates that she could make about $25,000,000 in revenue and about $1,000,000 in profits during the first year. Roxanne keeps no inventory. Roxanne also heard from her friend that there are some new deductions/benefits for small business. Please advise Roxanne for structuring her business. explain in detail

3. Victoria, a shareholder bought 10,000 shares of Jones Corporation for $50,000 several years ago. When the stock is valued at $90,000, Jones Corporation redeems the shares in exchange for 5,000 shares of Smith Corporation stock and a $10,000 Smiths bond. Assume the transaction meets the requirements of 368. Which of the following statements is false regarding this transaction? Please explain your reasoning. explain in detail.

a.	Victoria has a realized gain of $40,000.
b.	Victoria has a postponed gain of $30,000.
c.	Victoria has a basis in the Smith Corp. stock of $70,000.
d.	Victoria has a recognized gain of $10,000.