Assume the same facts as in Problem 26 except that
Assume the same facts as in Problem 26, except that Jeff's share of corporate tax able income is only $8,000 and there is no cash distribution. The corporation repays the $10,000 loan principal to Jeff. Discuss the tax effects. Assume that there was no corporate note (i.e., only an account payable). Does this change your answer? Explain.
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