Reference no: EM132471606

Distributions and amount of dividend

Question A. Current E&P = 30,000 and accumulated E&P = 20,000. Shareholder A owned all the stock and then sold all of it to B during the year. The corporation makes two distributions of $22,000 with A getting the first and B getting the second distribution. How much dividend does each shareholder have?

Question B. What if the distributions are each $32,000?

Question C. Following up with part B: What are the rest of the tax results to B if B's AB in stock = 4,000?

Question D. Accumulated E&P = $20,000. Current E&P = $30,000. Distributions: April 10 $20,000, July 15 $24,000, and September 15 $36,000. How much of each distribution would be a dividend?

Question E. Current E&P = 30,000 and accumulated E&P is a deficit of $20,000. The distributions are the same as part D.

Question F. Accumulated E&P = $15,000. Current E&P = $(12,000). Current E&P is incurred ratably through the year. Distribution = $10,000 on September 1.

Question G. What if the distribution in part F. is $1,000 instead?