Lark Corp distributes land with a fair market value of $80,000 and an adjusted basis of $55,000, to its shareholder, Hal The land is subject to a liability of $34,000 Assume that Lark has sufficient Earnings and Profits that any distribution to Hal will be taxable as a dividend to him Required Answer the following questions a How much dividend income will Hal have to report on his tax return for the current year What will be Hal's basis in the land b What effect, if any, will the distribution have on Lark's taxable income c What effect(s) will the distribution have on Lark's E P

Question

Lark Corp  distributes land with a fair market value of $80,000 and an adjusted basis of $55,000, to its shareholder, Hal  The land is subject to a liability of $34,000  Assume that Lark has sufficient Earnings and Profits that any distribution to Hal will be taxable as a dividend to him  Required  Answer the following questions  a  How much dividend income will Hal have to report on his tax return for the current year  What will be Hal's basis in the land  b  What effect, if any, will the distribution have on Lark's taxable income  c  What effect(s) will the distribution have on Lark's E   P

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Lark Corp. distributes land with a fair market value of $80,000 and an adjusted basis of $55,000, to its shareholder, Hal. The land is subject

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