Chapter 6 Quiz - Quiz 6 True/False Indicate whether the...

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Unformatted text preview: Quiz 6 True/False Indicate whether the statement is true or false. ____ 1. Since dividend income is taxed at the same rates as long-term capital gains, John, an individual shareholder, is indifferent as to whether a stock redemption is treated as a sale or as a dividend distribution. ____ 2. A corporation distributes property (fair market value of $20,000; basis of $13,000) to a shareholder in a quali- fying stock redemption. The shareholder will have a basis in the property equal to the corporations basis in the property, or $13,000. ____ 3. In applying the stock attribution rules to a stock redemption, a shareholder is treated as owning the stock of her siblings (i.e., sisters and brothers). ____ 4. In applying the stock attribution rules to a stock redemption, stock owned by a partnership is deemed to be owned in full by a partner of the partnership. ____ 5. James and his son are the sole shareholders of Wren Corporation. During the current year, Wren distributes cash in redemption of all of Jamess stock. James continues to serve on the board of directors of Wren Cor-cash in redemption of all of Jamess stock....
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This note was uploaded on 04/25/2011 for the course AIM 6352 taught by Professor Kennethl.bressler during the Spring '11 term at University of Texas at Dallas, Richardson.

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Chapter 6 Quiz - Quiz 6 True/False Indicate whether the...

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