During the current year, Gnatcatcher, Inc., (E & P of $1,400,000) distributed $645,000 each to Brandi and Yuen in redemption of some of their Gnatcatcher stock. The two shareholders acquired their shares five years ago. Each shareholder is in the 33% tax bracket, and each had a $161,250 basis in the redeemed stock.

If required, round your answers to nearest dollar.

a. Assume the distribution to Brandi is a qualifying stock redemption.

The distribution is taxed as a sale or exchange and Brandis tax liability on the distribution is $_______?

b. Assume the distribution to Yuen is a nonqualified stock redemption.

The distribution is taxed as a dividend and Yuens tax liability on the distribution is $____?