Cordeio, Inc., is a calendar year taxpayer and a CFC for the entire tax year. Yancy Company,

Question:

Cordeio, Inc., is a calendar year taxpayer and a CFC for the entire tax year. Yancy Company, a U.S. corporation, owns 75% of Cordeio’s one class of stock for the entire year. Cordeio’s Subpart F income for the year is $450,000, and no distributions were made to the parent. Determine Yancy’s gross income from the Subpart F constructive dividend from Cordeio.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...