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#11: Redemptions: § 302(b)(2). Z. Corporation has 1,000 shares of stock outstanding owned as follows: A B C D Shareholder Shares Owned 100 100 200 600 1,000 Adjusted Basis $10,000 10,000 20,000 60,000 All shareholders paid $100 per share for their stock. Z has substantial earnings and profits. a. During the year, the corporation redeemed 400 shares of D's stock for $400,000. What is the effect of the redemption on D? b. Same as (a) except the corporation redeemed 200 shares of D's stock for $200,000.

#11: Redemptions: § 302(b)(2). Z. Corporation has 1,000 shares of stock outstanding owned as follows: A B C D Shareholder Shares Owned 100 100 200 600 1,000 Adjusted Basis $10,000 10,000 20,000 60,000 All shareholders paid $100 per share for their stock. Z has substantial earnings and profits. a. During the year, the corporation redeemed 400 shares of D's stock for $400,000. What is the effect of the redemption on D? b. Same as (a) except the corporation redeemed 200 shares of D's stock for $200,000.

SWFT Comprehensive Vol 2020
SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter22: S Corporations
Section: Chapter Questions
Problem 4BCRQ
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#11: Redemptions: § 302(b)(2). Z. Corporation has 1,000 shares of stock outstanding owned as follows: A B C D Shareholder Shares Owned 100 100 200 600 1,000 Adjusted Basis $10,000 10,000 20,000 60,000 All shareholders paid $100 per share for their stock. Z has substantial earnings and profits. a. During the year, the corporation redeemed 400 shares of D's stock for $400,000. What is the effect of the redemption on D? b. Same as (a) except the corporation redeemed 200 shares of D's stock for $200,000.
Transcribed Image Text:#11: Redemptions: § 302(b)(2). Z. Corporation has 1,000 shares of stock outstanding owned as follows: A B C D Shareholder Shares Owned 100 100 200 600 1,000 Adjusted Basis $10,000 10,000 20,000 60,000 All shareholders paid $100 per share for their stock. Z has substantial earnings and profits. a. During the year, the corporation redeemed 400 shares of D's stock for $400,000. What is the effect of the redemption on D? b. Same as (a) except the corporation redeemed 200 shares of D's stock for $200,000.
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