South-western Federal Taxation 2018: Individual Income Taxes
41st Edition
ISBN: 9781337385886
Author: William H. Hoffman, James C. Young, William A. Raabe, David M. Maloney, Annette Nellen
Publisher: Cengage Learning
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Question
Chapter 20, Problem 33CE
To determine
State the character of the distribution to Person E.
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Suppose that at the beginning of 2021 Jamaal's basis in his S corporation stock is $1,000 and he has a $10,000 debt basis associated with a $10,000 loan he
made to the S corporation. In 2021, Jamaal's share of S corporation income is $4,000, and he received a $7.000 distribution from the S corporation. How
much total income does Jamaal report in 2021 from these transactions?
Multiple Choice
$0
$4,000
$6,000
$7,000
None of the choices are correct.
(1) XYZ Corporation is a calendar-year corporation. Ann and Paul each own 50% of the
corporation's stock. Ann's adjusted basis in her XYZ stock is 7,800 and Paul's adjusted
basis in his stock is $4,300. During the year 2019, XYZ makes the following cash
distributions split equally between Ann and Paul:
April 30
October 31
$15,000
$10,000
What is the amount, character and source of each section 301 distribution to Ann and Paul
under each of the following assumptions?
(a) Accumulated Earnings and Profits as of 1/1/19 of $-0-. Current Earnings
and Profits for 2019 of $16,000 all of which is attributable to the period May 1
through December 31.
(b) Accumulated Earnings and Profits as of 1/1/19 of $12,000. Current Earnings
and Profits for 2019 of $8,000.
(c) Accumulated Earnings and Profits as of 1/1/19 of negative $15,000. Current
Earnings and Profits for 2019 of $22,000.
Pete, the sole shareholder of Robin Corporation, had a basis of $120,000 in Robin stock that he sold to Adam on August 1, 2020, for $180,000. Robin had accumulated E & P of $26,000 on January 1, 2020, and current E & P (for 2020) of $90,000. During 2020, Robin made the following distributions: $60,000 cash to Pete on July 1, 2020, and $120,000 to Adam on November 1, 2020.
Required:
Determine the tax consequences of the distribution to Pete and his gain on the sale of his stock to Adam.
b. What are the tax consequences of the distribution to Adam?
Chapter 20 Solutions
South-western Federal Taxation 2018: Individual Income Taxes
Ch. 20 - Prob. 1DQCh. 20 - LO.1 Sylvia and Trang want to enter into business...Ch. 20 - Prob. 3DQCh. 20 - Prob. 4DQCh. 20 - Prob. 5DQCh. 20 - Prob. 6DQCh. 20 - LO.3, 4, 5 Contrast the income taxation of...Ch. 20 - LO.3, 8, 9 The taxpayer has generated excess...Ch. 20 - Prob. 9DQCh. 20 - Prob. 10DQ
Ch. 20 - Prob. 11DQCh. 20 - Prob. 12DQCh. 20 - Prob. 13DQCh. 20 - Prob. 14DQCh. 20 - Prob. 15DQCh. 20 - Prob. 16DQCh. 20 - Prob. 17DQCh. 20 - Prob. 18DQCh. 20 - Prob. 19DQCh. 20 - Prob. 20DQCh. 20 - Prob. 21DQCh. 20 - Prob. 22DQCh. 20 - Prob. 23DQCh. 20 - Blaine, Cassie, and Kirstin are equal partners in...Ch. 20 - Prob. 25DQCh. 20 - LO.3 Green Corporation, a calendar year taxpayer,...Ch. 20 - Prob. 27CECh. 20 - Banana Corporation is a May 31 fiscal year...Ch. 20 - LO.4 Gold and Silver are two unrelated calendar...Ch. 20 - Maroon Corporation is a calendar year taxpayer....Ch. 20 - Prob. 32CECh. 20 - Prob. 33CECh. 20 - Prob. 34CECh. 20 - Drab Corporation, a calendar year S corporation,...Ch. 20 - Kim is a 40% shareholder in Taupe Corporation, a...Ch. 20 - Prob. 37CECh. 20 - LO.3, 4, 5 Using the legend provided below,...Ch. 20 - LO.3 Garnet has the following capital asset...Ch. 20 - LO.3, 8 Citron, a calendar year taxpayer, began...Ch. 20 - LO.3 Taupe, a calendar year taxpayer, has a...Ch. 20 - LO.3, 8 Robin had the following capital...Ch. 20 - Prob. 43PCh. 20 - Prob. 44PCh. 20 - Prob. 45PCh. 20 - Prob. 46PCh. 20 - Prob. 47PCh. 20 - Prob. 48PCh. 20 - Prob. 49PCh. 20 - Prob. 50PCh. 20 - Prob. 51PCh. 20 - Prob. 52PCh. 20 - Prob. 53PCh. 20 - Prob. 54PCh. 20 - During the current year, Thrasher (a calendar...Ch. 20 - Prob. 56PCh. 20 - Jim Olsen owns all of the stock in Drake, a...Ch. 20 - Prob. 58PCh. 20 - Prob. 59PCh. 20 - LO.9 The Pheasant Partnership reported the...Ch. 20 - Prob. 61PCh. 20 - Prob. 62PCh. 20 - Prob. 63PCh. 20 - Prob. 1RPCh. 20 - Prob. 2RPCh. 20 - Prob. 3RPCh. 20 - Prob. 5RPCh. 20 - On January 1, year 5, Olinto Corp., an accrual...Ch. 20 - Prob. 2CPACh. 20 - Prob. 3CPACh. 20 - Prob. 4CPACh. 20 - Prob. 5CPACh. 20 - Prob. 6CPACh. 20 - Prob. 7CPA
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