White Corporation is a calendar-year taxpayer. Wilhelmina owns all of Whites stock. Her basis in the stock is $25,000. On March 1 of the current year, White Corporation distributes property with a $40,000 tax basis and a $60,000 fair market value to Wilhelmina. Determine the tax consequences of the distribution to Wilhelmina in each of the following independent situations:

Required. Using the chart below, specify the tax consequences of the distribution to Wilhelmina in each of the four following independent situations.

Current Accumulated E&P E&P 1.15,000 50,000 2. 25,000 (25,000) 3. (36,500) 65,000 4. (10,000) (25,000) Portion of the Distribution That Will be Treated as: Return of Dividend Capital Capital Income Gain