Determine the tax consequences of the cash distribution

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Question - Kings Corporation is a calendar year taxpayer. Susan owns all of its stock. Her basis for the stock is $6,000. On April 1 of the current? (non-leap) year Kings distributes $55,000 to Susan.

Determine the tax consequences of the cash distribution in each of the following independent? situations:

a. Current? E&P of $20,000?; accumulated? E&P of $18,000.

b. Current? E&P of $35,000?; accumulated? E&P deficit of $(24,000).

c. Current? E&P deficit of $(68,000)?; accumulated? E&P of $50,000.

d. Current? E&P deficit of $(28,000)?; accumulated? E&P deficit of $(15,000).

Reference no: EM133058498

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