Unrelated parties Amy, Beth, Carla, and Delta Corporation each own 25 of the 100 outstanding shares of Axle Corporation stock. In a transaction that qualifies as a partial liquidation, Axle distributes 20000 cash to each shareholder in exchange for five Axle shares. Each redeemed share has a 1000 basis to the shareholder and a 4000 FMV. How does each shareholder treat the distribution for tax purposes?

	Treatment	Amount	Character
Amy
Beth
Carla
Delta Corporation

Treatment Option Dividend Recognition or Sale of Stock

Character Option Capital Gain, Dividend, Return of Capital

(All Shareholders, or Amy, or Beth, or Carla, Or Delta) are/is entitled to a(n) (?)% (capital loss or ordinary gain or dividends received deduction