Question
Gaelic Corporation, an S corporation with one shareholder, incurred the following items: Year 1 Ordinary loss ($27,000) Year 2 Ordinary income $20,000 Cash distribution 5,000
Gaelic Corporation, an S corporation with one shareholder, incurred the following items:
| Year 1 | ||
| Ordinary loss | ($27,000) | |
| Year 2 | ||
| Ordinary income | $20,000 | |
| Cash distribution | 5,000 | |
| Year 3 | ||
| Ordinary income | $15,000 | |
| Cash Distribution $12,000
| ||
Requirements:
| A. Assuming the corporation has no accumulated E&P, show items reported by the shareholder in each year, show all basis adjustments to stock and debt, and show the stock and debt bases at the end of each year. | |
| B. Redo Part a for Year 2 and Year 3 assuming ordinary income in Year 2 is $4,000 instead of $20,000. | |
| C. Go back to the original facts and again redo Part a for all years assuming that, at the beginning of Year 1, the corporation had a AAA balance of zero and accumulated E&P of $8,000. |
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Understanding Terrorist Finance
Authors: T. Wittig
2011th Edition
0230291848, 978-0230291843
