Questions from Federal Taxation

Q: Beth R. Jordan lives at 2322 Skyview Road, Mesa,

Beth R. Jordan lives at 2322 Skyview Road, Mesa, AZ 85201. She is a tax accountant with Mesa Manufacturing Company, 1203 Western Avenue, Mesa, AZ 85201 (employer identification number 11-1111111). She...

Q: What are the tax consequences to Euclid from the following independent events

What are the tax consequences to Euclid from the following independent events? a. Euclid bought 500 shares of common stock five years ago for $50,000. This year, Euclid receives 20 shares of common st...

Q: During the current year, Gnatcatcher, Inc., (E &

During the current year, Gnatcatcher, Inc., (E & P of $1 million) distributed $200,000 each to Brandi and Yuen in redemption of some of their Gnatcatcher stock. The two shareholders acquired their sha...

Q: Rosalie owns 50% of the outstanding stock of Salmon Corporation.

Rosalie owns 50% of the outstanding stock of Salmon Corporation. In a qualifying stock redemption, Salmon distributes $80,000 to Rosalie in exchange for one-half of her shares, which have a basis of $...

Q: At the beginning of the year, Myrna Corporation (a calendar

At the beginning of the year, Myrna Corporation (a calendar year taxpayer) has E & P of $32,000. The corporation generates no additional E & P during the year. On December 31, the corporation distribu...

Q: On January 1 of the current year, Rhondell Corporation has accumulated

On January 1 of the current year, Rhondell Corporation has accumulated E & P of $13,000. Current E & P for the year is $84,000, earned evenly throughout the year. Elizabeth and Jonathan are so...

Q: Robin Corporation would like to transfer excess cash to its sole shareholder

Robin Corporation would like to transfer excess cash to its sole shareholder, Adam, who is also an employee. Adam is in the 28% tax bracket, and Robin is in the 34% bracket. Because Adam’s contributio...

Q: Which of the following individuals qualify for the earned income credit?

Which of the following individuals qualify for the earned income credit? a. Thomas is single, 21 years old, with no qualifying children. His income consists of $9,000 in wages. b. Shannon, who is 27 y...

Q: Caramel Corporation has 5,000 shares of stock outstanding. In

Caramel Corporation has 5,000 shares of stock outstanding. In a qualifying stock redemption, Caramel distributes $145,000 in exchange for 1,000 of its shares. At the time of the redemption, Caramel ha...

Q: Derk owns 250 shares of stock in Rose Corporation. The remaining

Derk owns 250 shares of stock in Rose Corporation. The remaining 750 shares of Rose are owned as follows: 150 by Derk’s daughter, 200 by Derk’s aunt, and 400 by a partnership in which Derk has an 80%...