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Holbrook, a calendar year S corporation, distributes $28,600 cash to its only shareholder, Cody, on December 31. Cody's basis in his stock is $34,320,
Holbrook, a calendar year S corporation, distributes $28,600 cash to its only shareholder, Cody, on December 31. Cody's basis in his stock is $34,320, Holbrook's AAA balance is $12,870, and Holbrook has $4,290 AEP before the distribution. According to the distribution ordering rules, complete the chart below to indicate how much of the $28,600 is from AAA and AEP as well as how Cody's stock basis is affected. If an amount is zero, enter "0". Beginning stock basis From AAA account From AEP account From Cody's stock basis Ending stock basis Distribution from Effect on Basis in Stock Account Stock Basis $34,320
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