C12-Chp-06-3B-Stock-Redemption-for-Property

C12-Chp-06-3B-Stock-Redemption-for-Property - Tab...

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0a56290434bc797898d4c51a39d6cd7d636f5c00.xlsx Page 1 of 3 No. These are old CPA Exam questions, placed in a spreadsheet format. H-W Txt Sec. Sub Case 1 Case 2 Case 3 1 Basic Information Hart Bart Day Individual (Hart, Bart or Day) is a 50% owner. Case 1, Hart owns 50% of stock of corporation. Case 1a, Hart receives $5,000 as a redemption, for one-half of his stock (25% of outstanding stock) Case 1b, Hart receives $5,000 in a liquidation. for ALL of his stock Repeat for Case 2. Bart and Case 3. Day Individual's basis in stock before distribution $9,000 $9,000 $50,000 Distribution from Corporation to Individual Cash $5,000 $5,000 $25,000 Land (could be other non-cash asset) Adjusted Basis of land to corp. before distribution $7,000 $15,000 Fair Market Value of land on date of distribution $10,000 $20,000 1a Redemption: (Redeem one-half of owner's stock) All redemptions get exchange treatment Gain Recognized by Corporation N/A 3 6-12 311 Basis of corporate stock that was redeemed? Gain or Income Recognized by Stockholder 6-13 302 b 2 Loss Recognized by Stockholder (Individual) 302 b 2 Stockholder's basis in non-cash property received 302 d Stockholder's Remaining Basis in Corporate Stock How would your answers differ above if distributions were for 10%, not 50% of stock? 1b Liquidation--corporation goes out of business This distribution is all the stockholder will ever get. 9, 10 Gain Recognized by Corporation N/A 6-18 336 Basis of all corporate stock owned by stockholder? Gain or Income Recognized by Stockholder
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C12-Chp-06-3B-Stock-Redemption-for-Property - Tab...

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