Shareholder A is the sole shareholder in S Corporation, an S Corporation. On January 1 of the
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Shareholder A is the sole shareholder in S Corporation, an S Corporation. On January 1 of the tax year specified for the exam, A's basis is $70,000. During that same year, the corporation has non-separately stated income of $30,000. A 1231 gain in the first half of the year of $3,000 and a charitable contribution in the second half of the year of $2,000. On July 1, of the same year, A sells his stock to B for $150,000.
a. A's gain is $80,000.
b. A's gain is $45,000.
C. A's gain is $62,000.
d. A's gain is $64,500
e. None of the above.
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