Question: On January 1 , 2 0 2 4 , Acme corporation, a calendar year C corporation distributes cash of $ 1 0 0 , 0

On January 1,2024, Acme corporation, a calendar year C corporation distributes cash of $100,000 and land to Tim (Acmes sole shareholder). The distribution was the only activity Acme incurred in 2024. Acme had a tax basis of $35,000 in the land which had a FMV of $50,000 when it was distributed. Acme had accumulated earnings and profits of $125,000 going into 2024. How will Tim treat the distribution?

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