Question 20
Tia owns 2,000 shares of Bass Corporation common stock with an $ 80,000 basis. Bass distributes a nontaxable preferred stock dividend. When the preferred stock is distributed, it has an FMV of $ 60,000 and the FMV of the 2,000 common stock shares is $ 180,000. The basis of the preferred stock is
Question 21
American Corporation acquires the noncash assets of Utech Corporation in exchange for $ 700,000 of its voting stock plus $ 50,000 of cash. Utech Corporation assets are worth $ 750,000. Utech Corporation does not distribute the stock and cash but instead holds the stock as an investment. Utech will use the American cash along with the cash it retained to start a new business. The transaction can be classified as a
Question 22
Dixie Corporation distributes $ 31,000 to its sole shareholder, Sally. At the time of the distribution, Dixie ' s E & P is $ 25,000 and Sally ' s basis in her Dixie stock is $ 10,000. Sally ' s basis in her Dixie stock after the distribution is
Question 23
Tomika Corporation has current and accumulated earnings and profits of $ 0. Tomika distributes $ 10,000 to its sole shareholder, Alana. What are Tomika ' s earnings and profits
Question 24
Which of the following items are tax preference items for purposes of arriving at alternative minimum taxable income?
Question 25