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What is B capital gain from the transaction

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Question - AB Corporation has two shareholders, A and B.A owns 50 shares worth $5,000 (basis = $1,000) and B owns 50 shares worth $5,000 (basis = $1,000). The corporation distributes $3,000 to B in exchange for 30 shares. What are the tax consequences to B?

Required -

(a) What is B's capital gain (if any) from the transaction?

(b) With regard to B's remaining shares in AB Corporation, what is his basis per share?

Reference no: EM132534281

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