At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $19,800 and accumulated E&P of $26,000 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $26,000. What is the amount and character of gain Nicolette must recognize from the distribution?

At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $19,800 and accumulated E&P of $26,000 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $26,000. What is the amount and character of gain Nicolette must recognize from the distribution?

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter19: Corporations: Distributions Not In Complete Liquidation

Section: Chapter Questions

Problem 32P

See similar textbooks

Similar questions

At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $15,000 and accumulated E&P of $20.000 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $20,000 distribution (the remaining shareholders received $30,000 in distributions) (Assume her stock basis is $40.000 after considering her share of Bombay's income for the year but before considering the effects of the distribution) Required: a. What are the amount and character of income or gain Nicolette must recognize from the distribution? b. What is her basis in her Bombay stock at the end of the year? a Dividend b. Basis Character Amount $ 8.000
At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $19,400 and accumulated E&P of $25,500 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $25,500 distribution (the remaining shareholders received $38,250 in distributions). (Assume her stock basis is $51,000 after considering her share of Bombay's income for the year but before considering the effects of the distribution.) Required: a. What are the amount and character of income or gain Nicolette must recognize from the distribution? b. What is her basis in her Bombay stock at the end of the year? Character Amount Short-term capital gain 25,500 X a. b. Basis 2$ 35,700 O
At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $19,600 and accumulated E&P of $25,750 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $25,750 distribution (the remaining shareholders received $38,625 in distributions). (Assume her stock basis is $51,500. after considering her share of Bombay's income for the year but before considering the effects of the distribution.) Required: a. What are the amount and character of income or gain Nicolette must recognize from the distribution? b. What is her basis in her Bombay stock at the end of the year? a b. Basis Character i Amount
My previous question was incomplete. The complete question is. At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $19,800 and accumulated E&P of $26,000 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $26,000 distribution (the remaining shareholders received $39,000 in distributions). Assume her stock basis is $52,000 after considering her share of Bombay’s income for the year but before considering the effects of the distribution. What is the amount and character of gain Nicolette must recognize from the distribution?
Deli Corporation (an S Corporation) is owned 100% by individual A. Deli earns business income of $40,000 in year one and distributes $30,000 to A in December of year one. The result is:
a) Calculate the S corporation's ordinary (non-separately stated) income and indicate which items must be separately stated b) If at the beginning of the year, Archer had a basis of 20,000 compute Archer’s basis at the end of the year. c) Assume that Voyager reported a loss of $70,000 instead (and no separately stated items or distributions). If Janeway had a basis of 10,000 in her stock at the beginning of the year, what is the amount of loss she can report on her return?
During the year, Tom, the sole shareholder of a calendar year S corporation, received a distribution of $20,000. At the end of last year, his stock basis was $5,000. The corporation earned $11,000 ordinary income during the year. It has no accumulated E & P. As a result of the distribution how much income/gain does Tom recognize? Answer:
XYZ Corporation, a calendar year C Corporation, has $100,000 gross business receipts, $5,000 interest income from corporate bonds, $20,000 qualified dividend income from a 5% owned C Corporation, $110,000 business expenses, and $2,000 charitable contribution. How much is XYZ's taxable income (or net operating loss) for the current year?\\n\\nGroup of answer choices\\n\\n$0 Taxable income.\\n\\n$3,000 Taxable income.\\n\\n$6,500 Taxable income.\\n\\n$6,750 Taxable income.
At the beginning of the year, Clampett, Inc. had $100,000 in its AAA, $60,000 of earnings and profits from prior C corporation years. During the year, Clampett, Inc. earned $50,000 of ordinary income and paid $200,000 in distributions to its shareholders. Assume that J. D. owns 25% of Clampett, Inc., his basis in Clampett, Inc. at the beginning of the year is $10,000, and his share of the distribution was $50,000. How much income does J. D. recognize this year from these transactions? $10,000. $0. $40,000. $17,500. None of the choices are correct.
Gopher Corporation began the year with a large amount of accumulated earnings and profits and ended the year reporting taxable income of $100,000. Gopher wants to distribute its after-tax earnings to its sole shareholder, Sven Anderson. The dividend would meet the requirements to be a qualified dividend, and Sven is subject to a tax rate of 15 percent on dividend income. What is the amount of the dividend distribution and how much income does Sven realize after taxes? Answer is not complete. Corporate income Corporate tax Dividend distribution to Seven Shareholder tax Total after tax income $100,000 $105,000 x $ 15,000
The profit and loss statement of Kitsch Ltd., an S corporation, shows $100,000 book income. Kitsch is owned equally by four shareholders. From supplemental data, you obtain the following information about items that are included in book income. a. Compute Kitsch’s nonseparately stated income or loss for the tax year. b. What would be the share of this year’s nonseparately stated income or loss items for James Billings, one of the Kitsch shareholders? c. What is James Billings’s share of tax-exempt interest income, if any? Is the income taxable to him this year?
As of the end of the current tax year, Mad Corp. has accumulated E&P of $31,000 and current E&P of $1,000. At the end of the year, Mad Corp. distributes $50,000 to its sole shareholder, Mary, whose stock basis is $10,000 (before the distribution). What amount of the distribution is treated as a dividend?