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29 Sep 2019
A corporation is considering a property distribution to itsshareholders.
Why would a corporation distribute a property dividend versus acash dividend?
What factors should the corporation consider before making theproperty distribution?
What are the effects of the property distribution on thecorporationâs E&P?
A corporation is considering a property distribution to itsshareholders.
Why would a corporation distribute a property dividend versus acash dividend?
What factors should the corporation consider before making theproperty distribution?
What are the effects of the property distribution on thecorporationâs E&P?
Collen VonLv2
29 Sep 2019
Related questions
On April 1, Delta Corporation distributes $120,000 in cash toeach of its two equal shareholders, Sarach and Matt. At the time ofthe distribution, Delta's E&P is $160,000. Sarah's basis in herstock is $50,000 and Matt's basis is $20,000. How are thesedistributions characterized to Sarah and Matt? Please be specificand use chart provided below.
Sarah | Matt | Total | |
|---|---|---|---|
| Distribution | $120,000 | $120,000 | $240,000 |
| Dividend income | |||
| Remaining distribution | |||
| Return of capital | |||
| Capital gain |
