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During the current year, Gnatcatcher, Inc., (E & P of $1,100,000) distributed $770,000 each to Brandi and Yuen in redemption of some of their

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During the current year, Gnatcatcher, Inc., (E & P of $1,100,000) distributed $770,000 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 32% tax bracket, and each had a $192,500 basis in the redeemed stock. Assume taxpayers in the 32% tax bracket are subject to the long-term capital gains and qualified dividends tax rate of 15%. If required, round your answers to nearest dollar. a. Assume that the distribution to Brandi is a qualifying stock redemption. The distribution is taxed as a and Brandi's tax liability is b. Assume that the distribution to Yuen is a nonqualified stock redemption. The distribution is taxed a and Yuen's tax liability is s

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