Individual Income Taxes
43rd Edition
ISBN: 9780357109731
Author: Hoffman
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Chapter 19, Problem 51P
a.
To determine
Calculate the amount taxable to Person T.
b.
To determine
Calculate the amount of ordinary income taxable to Person T.
c.
To determine
Calculate the amount deductible as compensation expense.
d.
To determine
State whether it would be wise for Person T to make the § 83(b) special election in 2014 and state the amount that is taxable during 2014 if Person T made the special decision.
e.
To determine
State the amount deductible five years later in part (d).
f.
To determine
Calculate the
g.
To determine
Calculate the amount of loss available to Person T if Person T voluntarily resigns during 2018 before the five-year period and the stock is not sold back to the corporation.
h.
To determine
Calculate the amount taxable to Corporation H during 2018.
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This year, Jack O. Lantern incurred a $75,000 loss on the worthlessness of his stock in the Creepy Corporation (CC). The stock, which Jack purchased in 2005, met all of the §1244 stock requirements at the time of issue. In December of this year, Jack's wife, Jill, also incurred a $80,900 loss on the sale of Eerie Corporation (EC) stock that she purchased in July 2005. Jill's purchase also satisfied all of the §1244 stock requirements at the time of issue. Both corporations are operating companies. Assume that they file a joint return.
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$60,000.
How are these distributions taxed to Miley assuming the following? (Leave no answer blank. Enter zero if
applicable. Enter N/A if not applicable.)
b. Both distributions are in cash, and the first was paid on June 15, 2018, and the second on September 30, 2018.
Answer is complete but not entirely correct.
Amount
Taxable
Taxable as
June 15
$
09
N/A
September 30
$
5,000
Ordinary
income
Last year, Miley decided to terminate the S corporation election of her solely owned corporation on October 17, 2018 (effective immediately), in preparation for taking it public. At the time of the election, the corporation had an accumulated adjustments account balance of $189,000 and $482,500 of accumulated E&P from prior C corporation years, and Miley had a basis in her S corporation stock of $164,250. During 2019, Miley’s corporation reported $0 taxable income or loss. Also, during 2019 the corporation made distributions to Miley of $99,500 and $73,000.How are these distributions taxed to Miley assuming the following? (Leave no answer blank. Enter zero if applicable. Enter N/A if not applicable.)
c. The first distribution was a property (noncash) distribution (fair market value of distributed property equal to basis) and was paid on June 15, 2019; the second distribution was a cash distribution, and was paid on September 30, 2019.
Chapter 19 Solutions
Individual Income Taxes
Ch. 19 - Prob. 1DQCh. 19 - Prob. 2DQCh. 19 - Prob. 3DQCh. 19 - Prob. 4DQCh. 19 - Prob. 5DQCh. 19 - Prob. 6DQCh. 19 - Prob. 7DQCh. 19 - Prob. 8DQCh. 19 - Prob. 9DQCh. 19 - Prob. 10DQ
Ch. 19 - Prob. 11DQCh. 19 - Prob. 12DQCh. 19 - Prob. 13DQCh. 19 - Prob. 14CECh. 19 - Prob. 15CECh. 19 - Prob. 16CECh. 19 - Prob. 17CECh. 19 - Zack, a sole proprietor, has earned income of...Ch. 19 - Prob. 19CECh. 19 - Prob. 20CECh. 19 - Prob. 21CECh. 19 - Prob. 22CECh. 19 - Prob. 23CECh. 19 - Prob. 24CECh. 19 - Prob. 25CECh. 19 - On April 5, 2017, Gustavo was granted an NQSO for...Ch. 19 - Prob. 27PCh. 19 - Prob. 28PCh. 19 - Prob. 29PCh. 19 - Prob. 30PCh. 19 - Prob. 31PCh. 19 - Prob. 32PCh. 19 - Prob. 33PCh. 19 - Prob. 34PCh. 19 - In 2019, Magenta Corporation paid compensation of...Ch. 19 - Prob. 36PCh. 19 - Prob. 37PCh. 19 - Prob. 38PCh. 19 - Prob. 39PCh. 19 - Prob. 40PCh. 19 - Prob. 41PCh. 19 - Prob. 42PCh. 19 - Prob. 43PCh. 19 - Prob. 44PCh. 19 - Carri and Dane, ages 34 and 32, respectively, have...Ch. 19 - Prob. 46PCh. 19 - Prob. 47PCh. 19 - Prob. 48PCh. 19 - Prob. 49PCh. 19 - Prob. 50PCh. 19 - Prob. 51PCh. 19 - Prob. 52PCh. 19 - Prob. 53PCh. 19 - Prob. 54PCh. 19 - Prob. 55PCh. 19 - Prob. 56PCh. 19 - Prob. 57PCh. 19 - Prob. 1RPCh. 19 - Prob. 2RPCh. 19 - Prob. 3RPCh. 19 - Prob. 6RPCh. 19 - Prob. 8RPCh. 19 - Prob. 1CPACh. 19 - Ryan is 39 years old and works as a real estate...Ch. 19 - Prob. 3CPACh. 19 - Prob. 4CPA
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