Egon owns 100% of Spengler Inc.'s stock. Egon has a tax basis in his Spengler Inc. stock of $20,000. Spengler Inc. has a negative current E&P of ($70,000) and a negative accumulated E&P of ($205,000). On December 31 of this year, Spengler Inc. makes a total distribution of $32,000. How much of the distribution is taxable as a capital gain to Egon? 

a. $0 

b. $12,000 

c. $20,000 

d. $32,000

Answer rating: 100% (QA)

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