At the end of 2021, Cobra, Inc, had accumulated earnings and proftis (AEP) of ($210,000). During 2021, Cobra, Inc. had current earnings and profits of $11,000. At year end, Cobra distributes an asset to Thomas (the sole shareholder of Cobra) with a fair market value of $80,000 and an adjusted basis of $20,000. Thomas basis in Cobra stock (prior to this distribution) is $100,000. Thomas has substantial income from other sources and is in the 37% tax bracket.

1. Determine the tax consequences to Thomas from receiving this distribution of property.
2. After the distribution, what is Thomas basis in Cobra, Inc. stock?
3. What impact (if any) will this distribution have on Cobras taxable income in 2021?
4. What is the ending balance in Cobras Accumulated E&P after this distribution of property?