Luke receives a property distribution from Vader Enterprises, Inc. (he inherited the corporation from his father). The property has a FMV of $625,000 and the corporation had a basis in it of $715,000. Vader has current E&P of $450,000 and accumulated E&P of ($200,000). At the time of the distribution, Luke had a basis of $375,000 in Vader.

Now assume the same facts as above, except that its a liquidating distribution, Lukes the sole shareholder, and the propertys not disqualified property.

1. What are the tax consequences to Luke? (4 points)