Question
Shareholders Basis in S Corporation Stock. An S corporation (with a $5,000 balance in its AAA and $8,000 of E&P) distributes $15,000 to its sole
Shareholders Basis in S Corporation Stock. An S corporation (with a $5,000 balance in its AAA and $8,000 of E&P) distributes $15,000 to its sole shareholder. The shareholders adjusted basis in his shares of stock was $12,000 prior to the distribution.
a. Is the shareholder taxed on the distribution, and if so, how?
b. Compute the shareholders basis in the S stock after the distribution.
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Contemporary Financial Management
Authors: Don Cyr, Alfred Kahl, William Rentz, R. Moyer
1st Edition
017616992X, 978-0176169923
