What is the effect of the income tax paid

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Question - A corporation distributes property with a fair market value of $50,000, an adjusted basis of $20,000 for taxable income purposes, and an adjusted basis of $15,000 for earnings and profit (E&P) purposes to one of its shareholders in a non-liquidating distribution. The property is encumbered by a $60,000 mortgage which the shareholder assumes. The corporation pays tax at a 34% marginal tax rate. What is the effect of the income tax paid on any gain on the corporation's E&P?

Reference no: EM132968615

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