1. Blue Corp exchanged $50,000 cash for all of Amys 100 shares in Blue ($10,000 basis; 30% ordinary income tax rate; 20% dividend income tax rate)

a) Under Sec 302 is the exchange a qualified stock redemption? Explain

b) Based on your above answer, how is the exchange treated and what are the tax consequences to Amy?

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2. Mark owned 100 shares ($100 basis; 30% ordinary income tax rate; 20% dividend income tax rate) of Pink Corp which had the following ownership rights, voting rights in Pink and rights to Pinks assets if it liquidated. Pink redeemed all of Marks Pink stock that had voting and liquidation rights by exchanging Marks stock for new Pink stock ($10,000 FMV) with no voting and liquidation rights

a: Under Sec 302, is the redemption of Marks Pink stock not essentially equivalent to a dividend? Explain

b: Depending on your answer above what are Marks tax consequences?

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3. John owned 100 shares ($100 basis; 30% ordinary income tax rate; 20% dividend income tax rate) of Green Corp which had the following ownership rights, voting rights in Green and rights to Greens assets if it liquidated. Pink redeemed all of Johns Pink stock that had voting and liquidation rights by exchanging Johns stock for new Green stock that has no liquidation rights but still has voting rights

a: Is the redemption not essentially equivalent to a dividend? Explain

b: Depending on your answer above what are Johns tax consequences?

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PLEASE ANSWER ALL THE QUESTIONS. SHOW WORKS FOR EXAM REVIEW!