For each of the distributions described in items 1 through 5, compute the proper tax amount For each item, enter the appropriate amounts in the associated cells If the amount is zero, enter a zero (0) Either column could have $0 for an answer Enter all values as positive numbers Situation Capital gain Taxable dividends 1 Distribution of $15,000 cash to a shareholder if the accumulated adjustments account balance is $5,000 and the shareholders basis in his or her stock is $15,000 There are no Subchapter C earnings and profits 2 Distribution of $15,000 cash to shareholder if the accumulated adjustments account balance is $10,000 The shareholders basis in his or her stock is $15,000 The Subchapter C earnings and profits balance is $5,000 No election to apply distributions to earnings and profits first has been made 3 Distribution of a computer to a shareholder when its basis to the S Corporation was $15,000 and its fair market value was $10,000 The accumulated adjustments account balance is $10,000, and the shareholders basis in his or her stock is $10,000 There are no Subchapter C earnings and profits 4 Distribution of $15,000 cash to a shareholder when the accumulated adjustment account balance is $5,000 and the shareholders basis in his or her stock is $5,000 The shareholder has made a bona fide loan (the balance is $5,000) to the corporation There are no Subchapter C earnings and profits 5 Distribution of $15,000 cash to a shareholder when the accumulated adjustments account balance is $5,000 and the shareholders basis in his or her stock is $5,000 There is $5,000 of Subchapter C earnings and profits No election to apply distributions to earnings and profits first has been made

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 17, 2024

For each of the distributions described in items 1 through 5, compute the proper tax amount. For each item, enter the appropriate amounts in the

For each of the distributions described in items 1 through 5, compute the proper tax amount.

For each item, enter the appropriate amounts in the associated cells. If the amount is zero, enter a zero (0). Either column could have $0 for an answer. Enter all values as positive numbers.

Situation	Capital gain	Taxable dividends
1. Distribution of $15,000 cash to a shareholder if the accumulated adjustments account balance is $5,000 and the shareholders basis in his or her stock is $15,000. There are no Subchapter C earnings and profits.
2. Distribution of $15,000 cash to shareholder if the accumulated adjustments account balance is $10,000. The shareholders basis in his or her stock is $15,000. The Subchapter C earnings and profits balance is $5,000. No election to apply distributions to earnings and profits first has been made.
3. Distribution of a computer to a shareholder when its basis to the S Corporation was $15,000 and its fair market value was $10,000. The accumulated adjustments account balance is $10,000, and the shareholders basis in his or her stock is $10,000. There are no Subchapter C earnings and profits.
4. Distribution of $15,000 cash to a shareholder when the accumulated adjustment account balance is $5,000 and the shareholders basis in his or her stock is $5,000. The shareholder has made a bona fide loan (the balance is $5,000) to the corporation. There are no Subchapter C earnings and profits.
5. Distribution of $15,000 cash to a shareholder when the accumulated adjustments account balance is $5,000 and the shareholders basis in his or her stock is $5,000. There is $5,000 of Subchapter C earnings and profits. No election to apply distributions to earnings and profits first has been made.