Adhering to current U.S. Tax Law answer the following:

-Flower Corporation is a calendar year, cash method C corporation. April, an individual, owns 100% of Flower Corporations stock. Aprils basis in the stock is $7,000. Flower Corporation has a positive current E&P balance of $15,000 and a deficit accumulated E&P balance of $20,000. If, on December 31, Flower Corporation distributes $50,000 in cash to April in a nonliquidating distribution (the only distribution made by Flower all year), what are the income tax consequences to April?

-Stockton Corporation is a cash method, calendar year corporation. On December 31, Stockton Corporation distributes $32,000 to its sole individual shareholder, Malone, in a nonliquidating distribution. At the time of the distribution, Stocktons current E&P is $12,000 and its accumulated E&P is $8,000. Malones basis in his Stockton stock is $21,000. What is Malones basis in his Stockton stock after the distribution?

-Your clients, Ben and Jerry, want to form a corporation to conduct a consulting business. They will be the only owners. Unfortunately, neither of them has cash or property to contribute to the corporation other than the following:

Ben: One share of Nike stock. Tax basis $30 and fmv $100

Jerry: One share of Disney stock. Tax basis $10 and fmv $100

Ben and Jerry each have owned their respective stock in Nike and Disney for three years. Ben and Jerry dont want to sell the stock and then contribute the cash proceeds to the corporation. Rather, they propose to contribute the stock to the corporation as a capital contribution in exchange for shares of stock in the newly formed corporation. Advise them of the tax consequences if they pursue this approach.

-C corporation is a cash method, calendar year corporation. R, an individual, is C corporations sole shareholder. On December 31, C corporation has a $225 current earnings and profits balance and a $50 accumulated earnings and profits balance. During the year C corporation made equal quarterly cash distributions of $100 each to R. R has a stock basis of $70 in his C corporation stock. What are the tax consequences to R of each distribution?

-C corporation distributes land to its only shareholder, individual R, in a nonliquidating distribution. The land has a tax basis of $130 to the corporation and its fmv is $150. The corporation has $500 in current earnings and profits and $200 in accumulated earnings and profits.

a. What is the gain or loss recognized by C corporation on the distribution?

b. What are the tax consequences to R?

c. Suppose instead that the land had a fair market value of $100 instead of $150 (and its basis is still $130) at the time of the distribution. What is the gain or loss recognized by C corporation on the distribution? What are the tax consequences to R?

-On May 1 of the current year, Kimberly, Victor, Pam, and Joe form Newco Corporation.

• Kimberly transfers land with a tax basis of $70,000 and a fair market value of $130,000. The land is encumbered with an $80,000 liability, which the corporation assumes as part of the transfer. Kimberly purchased the land four years ago. Kimberly received 50 shares of stock in return.

• Victor transfers equipment with a tax basis of $20,000 and a fair market value of $40,000 in exchange for 30 shares of stock and $10,000 in cash from the corporation. Victor purchased the equipment three years ago.

• Joe provides legal services to the corporation worth $10,000 in exchange for 10 shares of stock.

• Pam transfers a personal car to with a tax basis of $25,000 and a fair market value of $15,000 in exchange for 10 shares of stock and $5,000 in cash from the corporation. Pam purchased the car two years ago.

a. What is Kimberlys amount realized?

b. What is your authority for your answer in Question a?

c. What is Kimberlys gain or loss realized?

d. What is Kimberlys gain or loss recognized?

e. What is your authority for your answer in Question d?

f. What is Kimberlys stock basis?

g. What is your authority for your answer in f?

h. What is Victors gain or loss recognized?

i. What is Joes stock basis?

j. What is Pams gain or loss realized?

k. What is Pams gain or loss recognized?

l. What is Pams stock basis?

m. What is Newcos tax basis in the equipment?