Question

When Gail dies, she owns 100% of the stock of an S corporation, with an adjusted basis of $10,000 and FMV of $100,000. The adjusted basis and FMV of the assets inside the S corporation are the same amounts as for Gail's stock. Gail's son Phil inherits all of the stock, but does not wish to continue the business. Therefore, the S corporation sells the assets, resulting in a $90,000 capital gain, and liquidates. Assuming that Phil is subject to a marginal tax rate of 30%, what taxes are due?
$0.
$25,000.
$27,000.
$30,000.


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  • CreatedJanuary 21, 2013
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