Stock Redemptions & Family Attribution Rules Problems

1. The following people own all of Corp Ys 2,000 shares of outstanding stock:

Karl 300 shares

Karls wife Karen 400 shares

Karls granddaughter Lisa 200 shares

Karls father John 500 shares

Karls stepson 600 shares

Pursuant to the family attribution rules for purposes of Sec 302, how many shares of Corp Y does Karl own directly and constructively (i.e., indirectly?

2. Karl directly owns: 1) his 300 shares of Corp Y; and 2) constructively owns 1,100 shares of Corp Y (wifes 400 shares + granddaughters 200 shares + fathers 500 shares)

aFor purposes of Sec 301, what is the definition of a complete termination of a shareholders interests in a corp?

bWhat are the exceptions to determining if a shareholders interests in a corp have been completely terminated?

cIf Corp Y redeemed all 300 shares Karl owns directly, but did not redeem the shares Karl indirectly owns, would the redemption be treated as a sale or exchange or a dividend transaction?

dWhy or why not?

3. Karl directly owns: 1) his 300 shares of Corp Y; and 2) constructively owns 1,100 shares of Corp Y (wifes 400 shares + granddaughters 200 shares + fathers 500 shares)

aIf Corp Y redeemed all 1,400 shares Karl owns directly and indirectly would this redemption be treated as a sale or exchange or a dividend transaction?

bWhy or why not?

4. Karl directly owns: 1) his 300 shares of Corp Y; and 2) constructively owns 1,100 shares of Corp Y (wifes 400 shares + granddaughters 200 shares + fathers 500 shares). In Ex 3, Corp Y redeemed all 300 shares Karl owns directly and his family waived the family attribution rules.

Has there been a complete termination of Karls Corp Y ownership, even though he still indirectly owns his wife, granddaughter and fathers Corp Y shares? Why or why not?

PLEASE ANSWER ALL THE QUESTIONS, DON'T SKIP IT AND SHOW YOUR WORKS!!!! REVIEW FOR QUIZ!!!