Smith owns 60% of X Corp.'s total outstanding shares of 1,000 shares

Smith acquired:

400 shares for $50,000 five years ago and,

200 shares for $1.9 million six months ago.

X Corp. wants to sell all of its assets and then liquidate.

(a) What are the U.S. tax consequences to Smith if X Corp. sells all of assets for cash, pays all of its debts, and distributes $6 million to Smith in complete liquidation.

(b) X Corp. adopted a plan of liquidation last year, then sold some of its assets late last year to an unrelated third party, and then distributed $3 million to Smith at that time. This year, X Corp. sold its remaining assets to an unrelated third party for cash, paid off its debts, and then distributed the remaining $1.5 million to Smith. What are the U.S. tax consequences to Smith?