September 3, 2008 MGMT 127B More S Corporations People not only pay money for stock, but they will sometimes loan a company money as well. When you make a loan to a company, you have a basis in the loan, so that when you get paid back, you have no in
$4 in stock 2008 August 11, Shareholder Corporation MGMT 127B $1 in cash Section 351 continued
Basis: $2 FMV: $5
Sometimes transactions are impure, meaning you dont purely get stock. You dont purely get a cow for a cow. My cow is worth $5 and yours
August 13, 2008 Shareholder STOCK Corporation $ MGMT 127B
Stock Redemptions Money comes out when the shareholder sells the stock back to the company. On its face it would seem like a capital gain. However, that could create a loophole, especially if
August 25, 2008 $ S/H MGMT 127B Complete Liquidation or Shut Down With a complete liquidation or shutdown, the corporation sells off property or hands off property in kind to the owners.
If we sell property a double tax exists.
August 6, 2008 MGMT 127B
FRIENDSHIP CASE (pg. 20 course reader) Does it make sense to make an investment that yields 7% and finance it using money that you borrowed at 9%?
Ignoring taxes, it seems like a foolish decision.
For every $7 that comes i
August 27, 2008 $60 of Shareholder MGMT 127B income S-Corporations Continued
Basis in stock = Contribution + % Income Received Distribution Review: If the company has $60 of earnings, and you own 10% of the company, it is as if you earned $6 o