Question: Duncan Inc. ( a C corporation ) has two shareholders: Jane ( 6 5 % ) and Shane ( 3 5 % ) . In

Duncan Inc. (a C corporation) has two shareholders: Jane (65%) and Shane (35%). In a current distribution, the corporation distributes $100,000 in total (each shareholder receiving according to the proportionate share of ownership). At the time of the distribution, the corporation's total E&P was $60,000, Jane's basis in the corporate stock was $12,000 and Shane's basis was $37,000.
What are the tax consequences of this distribution to Jane?

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