Chapter 4 corporate nonliquidating distributions
25) Oreo Corporation has accumulated E&P of ,000 at the beginning of the current year.
During the year (a nonleap year), the corporation incurs a current E&P deficit of ,250.
The land has an FMV of ,000 and an adjusted basis of ,000.
304 redemption rules if one shareholder owns more than 50% of each corporation.
B) When making a nonliquidating distribution, a corporation recognizes gains and losses.
C) When making a nonliquidating distribution, the corporation's E&P is reduced by the property's FMV even though the property's basis is greater than its FMV. 28) Hogg Corporation distributes ,000 to its sole shareholder, Ima. 29) One consequence of a property distribution by a corporation to a shareholder is that A) the amount of the distribution is increased by any liability assumed by the shareholder.
3) When computing E & P, Section 179 property must be expensed ratably over a five-year period, starting with the month in which it is expensed for Sec. 4) A shareholder's basis in property distributed as a dividend is its fair market value.
5) When appreciated property is distributed in a nonliquidating distribution, the net effect on the distributing corporation's E&P is that it is reduced by the FMV of the property distributed and increased by the gain (net of federal income taxes) recognized due to the property distribution.