Ms. X needs CASH NOW! She is proposing to redeem 1,000 shares of stock in XYZ Corporation for $85,000. The ownership of XYZ Inc. is listed below:

Shares Owned Before Shares Owned After Proposed Transaction Proposed Transaction Ms. X 2,000 Mr. Q (Son of Ms. X) 500 Mr. Y (Neighbor of Ms. X) 2,250 Dr. Z (5th Cousin of Ms. X) 1,850 XYZQ Partnership 1,000 ABC Inc. 1,000 PDQ Trust 1,400 Total 10,000

XYZQ Partnership is owned (30% by X, 20% by Q, 40% by Y and 10% by Z

ABC Inc. is owned (40% by X, 20% by Q, 30% by Y and 10% by Z.

PDQ Trust Beneficiaries are Q - 50% and Z - 50%.

For the current year XYZQ Inc. had $50,000 of Current E&P along with $150,000 of Accumulated E&P

Ms. X had a $90,000 basis in her 2,000 Shares of Stock

Ms. X transferred (1,000 shares) of stock back to the corporation in exchange for $85,000 in cash

Determine the amount and character of gain recognized by Ms. X on the transfer of 1,000 shares in XYZ Corporation.

Ownership Percent Before Stock Sale [ Select ] ["Between 45.5% and 44.5%", "Between 41.5% and 40.5%", "Between 48.5% and 47.5%", "Between 35.5% and 34.5%", "Between 38.5% and 37.5%", "Between 40.5% and 39.5%", "Between 39.5% and 38.5%", "Between 42.5% and 41.5%", "Between 36.5% and 35.5%", "Between 47.5% and 46.5%", "Between 44.5% and 43.5%", "Between 49.5% and 48.5%", "Between 37.5% and 36.5%", "Between 43.5% and 42.5%", "Between 46.5% and 45.5%"]

Ownership Percent After Stock Sale [ Select ] ["Between 34.5% and 33.5%", "Between 29.5% and 28.5%", "Between 45.5% and 44.5%", "Between 42.5% and 41.5%", "Between 36.5% and 35.5%", "Between 27.5% and 26.5%", "Between 37.5% and 36.5%", "Between 39.5% and 38.5%", "Between 40.5% and 39.5%", "Between 30.5% and 29.5%", "Between 33.5% and 32.5%", "Between 43.5% and 42.5%", "Between 28.5% and 27.5%", "Between 35.5% and 34.5%", "Between 31.5% and 30.5%", "Between 44.5% and 43.5%", "Between 38.5% and 37.5%", "Between 41.5% and 40.5%", "Between 32.5% and 31.5%"]

Dividend Income [ Select ] ["215,000", "100,000", "150,000", "0", "85,000", "200,000", "50,000"]

Capital Gain (Loss) [ Select ] ["220,000", "240,000", "40,000", "200,000", "120,000", "110,000", "75,000", "180,000", "60,000", "150,000", "215,000", "100,000", "0", "20,000", "140,000", "125,000", "80,000", "25,000", "225,000", "50,000"]

Ending Balance of Total E&P (Current E&P + Accumulated E&P)