Regarding C corps. As part of a plan of complete liquidation, a C corp. distributes $1,000 cash and land to its sole shareholder. The land has a basis to the C corp. of $8,000 and a fair market value of $10,000. The shareholder’s basis in the C corp. stock, before the distribution, is $9,000. What is the tax treatment to the C corp. and to the shareholder of the distribution?

Regarding S corps. An S corp. with $500 in AAA and $200 in AEP distributes $1,500 cash (in liquidation) to a shareholder who has a basis in her stock of $600. What is the tax treatment to the S corp. and to the shareholder of the distribution?

Regarding partnerships. The ABC partnership distributes (in liquidation) $500 cash and 2 parcels of land (parcel 1 has a FMV of $2,000, and an inside basis $1,000, parcel 2 also has a FMV of $2,000, and an inside basis $1,000) to partner A whose outside basis is $3,500. What is the tax treatment to the partnership and to the partner of the distribution?