Exercise 19-28 (Algorithmic) (LO. 8) During the current year, Gnatcatcher, Inc. (E & P of $1,150,000), distributed $535,000 each to Brandi and Yuen in redemption of some of their Gnatcatcher stock. The two shareholders acquired their shares five years ago. Each shareholder is in the 32% tax bracket, and each had a $133,750 basis in the redeemed stock. Assume taxpayers in the 32% tax bracket are subject to the long-term capital gains and qualified dividends tax rate of 15%. If required, round your answers to nearest dollar. a. Assume that the distribution to Brandi is a qualifying stock redemption. The distribution is taxed as a sale or exchange and Brandi's tax liability is $ Feedback Check My Work Under 317(b), a stock redemption occurs when a corporation acquires its stock from a shareholder in exchange for cash or other prop Code does allow sale or exchange treatment for certain kinds of stock redemptions. In these transactions, as a general rule, the shareh ownership interest is diminished as a result of the redemption. b. Assume that the distribution to Yuen is a nonqualified stock redemption. The distribution is taxed a dividend and Yuen's tax liability is $