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Lupe and Rodrigo, father and son, each own 50% of...




Lupe and Rodrigo, father and son, each own 50% of the stock outstanding of Heron Corporation (Eof $400,000). During the current year, Heron redeems all of Lupe's shares for $250,000. The transaction cannot qualify as a complete termination redemption if: (Points : 5) Lupe filed an agreement with his return to notify the IRS of any prohibited interest acquired in the 10-year postredemption period. Lupe received a $250,000 note receivable from Heron in the stock redemption. Lupe continued to serve on Heron Corporation's board of directors for one year following the redemption. Lupe loaned Heron Corporation $50,000 two years following the redemption. 22. In the current year, Dove Corporation (E & P of $1 million) distributes all of its property in a complete liquidation. Alexandra, a shareholder, receives land having a fair market value of $300,000. Dove Corporation had purchased the land as an investment three years ago for $375,000, and the land was distributed subject to a $270,000 liability. Alexandra took the land subject to the $270,000 liability. What is Alexandra's basis in the land? (Points : 5) $375,000. $300,000. $270,000. $30,000. 23. Roger is a 30% partner in the ROC Partnership. At the beginning of the tax year, Roger's basis in the partnership interest was $60,000, including his share of partnership liabilities. During the current year, ROC reported net ordinary income of $40,000. In addition, ROC distributed $5,000 to each of the partners ($15,000 total). At the end of the year, Roger's share of partnership liabilities increased by $20,000. Roger's basis in the partnership interest at the end of the year is: (Points : 5) $60,000. $75,000. $87,000. $120,000. 24. Kaylyn is a 40% partner in the KKM Partnership. During the current year, KKM reported gross receipts of $160,000 and a charitable contribution of $10,000. The partnership paid office expenses of $100,000. In addition, KKM distributed $10,000 each to partners Kaylyn and Kristie, and the partnership paid partner Megan $20,000 for administrative services. Kaylyn reports the following income from KKM during the current tax year: (Points : 5) $4,000 ordinary income. $12,000 ordinary income. $8,000 ordinary income; $4,000 charitable contribution. $16,000 ordinary income; $4,000 charitable contribution. Marcie is a 40% partner in the MAP Partnership. During the current tax year, the partnership reported ordinary income of $140,000 before payment of guaranteed payments and distributions to partners. The partnership made an ordinary cash distribution of $10,000 to Marcie, and paid guaranteed payments to partners Marcie, Alice, and Pat of $20,000 each ($60,000 total). How much will Marcie's adjusted gross income increase as a result of the above items? (Points : 5) $32,000 $52,000 $56,000 $76,000


Paper#2148 | Written in 18-Jul-2015

Price : $25