Question: Raven Corporation owns three machines that it uses in its
Raven Corporation owns three machines that it uses in its business. It no longer needs two of these machines and is considering distributing them to its two shareholders as a property dividend. The machines have a fair market value of $20,000 each. The basis of each machine is as follows: A, $27,000; B, $20,000; and C, $12,000. Raven has asked you for advice. What do you recommend?
Answer to relevant QuestionsCerulean Corporation has two equal shareholders, Eloise and Olivia. Eloise acquired her Cerulean stock three years ago by transferring property worth $700,000, basis of $300,000, for 70 shares of the stock. Olivia acquired ...Your client, Raptor Corporation, declares a dividend permitting its common shareholders to elect to receive 9 shares of cumulative preferred stock or 3 additional shares of Raptor common stock for every 10 shares of common ...Assume in Problem 26 that Julio has a capital loss carryover of $50,000 in the current tax year. Julio has no other capital gain transactions during the year. What amount of the capital loss may Julio deduct in the current ...Dove Corporation (E & P of $800,000) has 1,000 shares of stock outstanding. The shares are owned as follows: Julia, 600 shares; Maxine (Julia’s sister), 300 shares; and Janine (Julia’s daughter), 100 shares. Dove owns ...A dividend is declared by the corporation’s board of directors, and it is paid to each shareholder in an equal fashion. Evaluate this statement from an accounting and Federal income tax standpoint. Summarize your position ...
Post your question