Problems from the South-Western federal taxation Comprehensive Volume.1) In Nove

Problems from the South-Western federal taxation Comprehensive Volume.1) In November of the current year Emerald Corporation declared a dividend of $2 per share (the shareholder record date is December 15). Assume that Emerald has sufficient current E & P to cover the dividend payment. If Judy purchase 500 shares of Emerald stock on December 5 and sells the stock on December 25 how is she taxed on the $1000 dividend?2) Heather an individual owns all of the outstanding stock in Silver Corporation. Heather purchased her stock in Silver nine years ago and her basis is $56000. At the beginning of this year the corporation has $76000 of accumulated E & P and no current E & P (before considering the effect of the distributions as noted below). What are the tax consequences to Heather (amount and type of income and basis in property received) and Silver Corporation (gain or loss and effect on E & P) in each of the following situations?a) Silver distributes land to Heather. The land was held as an investment and has a fair market value of $54000 and an adjusted basis of $42000.b) Assume that Silver Corporation has no current or accumulated E & P prior to the distribution. How would your answer to (a) change?c) Assume that the land distributed in (a) is subject to a $46000 mortgage (which Heather assumes). How would your answer change?d) Assume that the land has a fair market value of $54000 and an adjusted basis of $62000 on the date of the distribution. How would your answer to (a) change?e) Instead of distributing land in (a) assume that Silver decides to distribute equipment used in its business. The equipment has a $14000 market value a $1200 adjusted basis for income tax purposes and a $5200 adjusted basis for E & P purposes. When the equipment was purchased four years ago its original fair market value was $18000.Chapter 201)Pursuant to a complete liquidation Oriole Corporation distributes to its shareholders land held for three years as an investment (adjusted basis of $250000. Fair market value of $490000). The land is subject to a liability of $520000.a) What are the tax consequences to Oriole Corporation on the distribution of the land?b) If the land is instead subject to a liability of $400000 what are the tax consequences to Oriole on the distribution?2)Pursuant to a complete liquidation in the current year Scarlet Corporation distributes to Jake land (basis of $425000 fair market value of $390000) that was purchased three years ago and held as an investment. The land is subject to a liability of $250000. Jake who owned 35% of the Scarlet shares outstanding had a basis of $60000 in the stock. What are the tax consequences of the liquidating distribution To Scarlet Corporation and to Jake?
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