Jack Corporation redeems 200 shares of its stock for $100,000 from Junior, who inherited the stock from
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Jack Corporation redeems 200 shares of its stock for $100,000 from Junior, who inherited the stock from his father, Ken. The stock’s FMV on Ken’s date of death was $90,000. Ken’s basis in the stock was $40,000. Jack Corporation had an E&P balance of $300,000. If the redemption qualifies under Sec. 303, Junior will
recognize a capital gain of $10,000.
recognize a capital gain of $60,000.
recognize $100,000 in dividend income.
recognize dividend income of $50,000 and a capital gain of $10,000.
Related Book For
Federal Taxation 2017 Comprehensive
ISBN: 9780134421438
30th edition
Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson
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