What is the amount and character of income recognized

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Problem - Corporate redemption - Gold Corporation (E&P of $1 million) has 2,000 shares of common stock outstanding owned by unrelated parties as follows: Veronica, 1,000 shares, and Tommie, 1,000 shares. Both Veronica and Tommie paid $150 per share for the Gold Corporation stock 12 years ago. In May of the current year, Gold distributes land held as a long-term investment worth $390,000 (basis of $180,000) to Veronica in redemption of 350 of her shares.

Required - What is the amount and character of income recognized by Veronica on the redemption of her Gold Corporation stock? What is her basis in the land?

Reference no: EM133014355

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