Chapter 16 Questions - Income Tax II Name _Christian...

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Income Tax II Name ___Christian Yimgnia________ Chapter 16 Questions Explain and/or discuss the following based on reading the chapter and viewing the power points. Be thorough with your answers. You may take all the space you need. 1. Describe the effects of a complete liquidation of a corporation on shareholders. A corporation must generally recognize gain or loss on the distribution of property in complete liquidation and as if the property were sold to the distribute shareholder at fair market value. The type of gain will depend on the nature of the property to the corporation as well as the property’s holding period. This approach will lead to a capital gain or loss treatment to the shareholders assuming their stock is held as a capital asset. And for shareholders the type of gain or loss will depend on the nature of the stock, not the property distributed. The amount of a stockholder gain or loss is calculated by
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This note was uploaded on 03/05/2012 for the course INCOME TAX 4404 taught by Professor Bulie during the Spring '11 term at University of Minnesota Duluth.

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Chapter 16 Questions - Income Tax II Name _Christian...

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