Jon owns 100 % of Jon, Inc (J). Jis liquidated and Jon receives land with a FMV of $500,000 and a tax basis of $300,000 and a building with a fair market value of $1,000,000 and a tax basis of $200,000. The building is subject to a mortgage of $100,000. Jon's basis in Jl stock $200,000. Jl has $3,000,000 of eamings and profits. As a result of the liquidation, Jon must recognize income of         OA $1,400,000 dividend Income OB. $1,300,000 capital gain OC 50 income OD. $1,200,000 capital gain

SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter18: Corporations: Organization And Capital Structure
Section: Chapter Questions
Problem 30P
icon
Related questions
Question

Jon owns 100 % of Jon, Inc (J). Jis liquidated and Jon receives land with a FMV of $500,000 and a tax basis of $300,000 and a building with a fair market value of $1,000,000 and a tax basis of $200,000. The building is subject to a mortgage of $100,000. Jon's basis in Jl stock $200,000. Jl has $3,000,000 of eamings and profits. As a result of the liquidation, Jon must recognize income of

 

 

 

 

OA $1,400,000 dividend Income

OB. $1,300,000 capital gain

OC 50 income

OD. $1,200,000 capital gain 

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Recommended textbooks for you
SWFT Comprehensive Vol 2020
SWFT Comprehensive Vol 2020
Accounting
ISBN:
9780357391723
Author:
Maloney
Publisher:
Cengage
CONCEPTS IN FED.TAX., 2020-W/ACCESS
CONCEPTS IN FED.TAX., 2020-W/ACCESS
Accounting
ISBN:
9780357110362
Author:
Murphy
Publisher:
CENGAGE L
SWFT Comprehensive Volume 2019
SWFT Comprehensive Volume 2019
Accounting
ISBN:
9780357233306
Author:
Maloney
Publisher:
Cengage
SWFT Essntl Tax Individ/Bus Entities 2020
SWFT Essntl Tax Individ/Bus Entities 2020
Accounting
ISBN:
9780357391266
Author:
Nellen
Publisher:
Cengage
SWFT Corp Partner Estates Trusts
SWFT Corp Partner Estates Trusts
Accounting
ISBN:
9780357161548
Author:
Raabe
Publisher:
Cengage