Corporation recognize as a result of the distribution

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Reference no: EM131286331

XYZ Corporation distributed land Jim, its sole shareholder, in a liquidating distribution. At the time of the distribution, the land had a fair market value of $120,000 and XYZ Corporation’s adjusted basis in the land was $100,000. The land was encumbered by a $140,000 mortgage, which mortgage was assumed by the shareholder. How much gain did XYZ Corporation recognize as a result of the distribution?

A. 0. B. $20,000. C. $40,000. D. $100,000.

Reference no: EM131286331

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