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Discuss the basis in the property to the distributee

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Comprehensive Problem.For each of the following independent distributions to shareholders, determine the impact on E&P; recognized gain, if any, to the distributing corporation; the amount of the dividend; and the basis in the property to the distributee, assuming ample E&P to start with:

A cash distribution of $50,000.
The distribution of an IOU with a face value of $50,000 and a market value of $45,000.
The distribution of inventory with a basis of $2,000 and a value of $5,000 to an individual shareholder.
The distribution of land with a basis of $25,000, a mortgage of $40,000, and a value of $100,000 to an individual shareholder.

Reference no: EM131810298

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