10 Max was party to a cross-purchase, buy-sell agreement when he died and owned 100 shares of TKL Inc. All of the parties to the agreement were dealing at arm's length. The agreement specified that the surviving shareholders would purchase Max's shares for a fixed price of $40 per share. Charlie originally acquired the shares for $5 per share. At the time of Max's death, the actual value of share was $60. Which of the following is true with regards to Max holding TKL Inc shares? a) Max's final tax return would not have a capital gain. Ob) Max's final tax return would show a capital gain of $20 per share. Max's final tax return would show a capital gain of $35 per share. d) Max's final tax return would show a capital gain of $55 per share.

10 Max was party to a cross-purchase, buy-sell agreement when he died and owned 100 shares of TKL Inc. All of the parties to the agreement were dealing at arm's length. The agreement specified that the surviving shareholders would purchase Max's shares for a fixed price of $40 per share. Charlie originally acquired the shares for $5 per share. At the time of Max's death, the actual value of share was $60. Which of the following is true with regards to Max holding TKL Inc shares? a) Max's final tax return would not have a capital gain. Ob) Max's final tax return would show a capital gain of $20 per share. Max's final tax return would show a capital gain of $35 per share. d) Max's final tax return would show a capital gain of $55 per share.

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter19: Corporations: Distributions Not In Complete Liquidation

Section: Chapter Questions

Problem 57P

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