drop down box 1: adjusted basis, FMV of assets, NOL drop down box 2: same as above = recongnized gain (loss)

[enter number] - [ enter number] = [enter number] The [gain/loss] from the preceding step alontg with any prodfits earned during the final tax year [will be offset by $400,000 of/will not be offset by any] NOL carryover.

The remaining NOL carryover [disappears when the liquidation is completed/ is treated as ordinary income].

Any profits and losses created in the year of liquidation [could be passed through Yancy and the other shareholders if a valid S corporation election is made./ WILL NOT be passed through and the other shareholders if a valid S corporation election is made.]

liquidate the corporation and have it distribute assets having a $675,000 FMV and a $275,000 adjusted basis to Yaussey owns 70% of Walton Corporation stock. At the beginning of the current year, the corporation has $525,000 of NOLS. Yaussey plans its shareholders. Explain to Yaussey the tax consequences the liquidation to Walton Corporation. .. Begin by calculating the gain or loss Walton will recognize upon liquidating the company's assets. (Use parentheses or a minus for a loss.) Recognized gain (loss) NOL carryover. The remaining NOL carryover Any profits and losses created in the The from the preceding step along with any profits earned during the final tax year year of liquidation