george and martha formed washington corporation as an s corporation several years ag 4519602

George and Martha formed Washington Corporation as an S corporation several years ago. George and Martha each have a 50% interest in the corporation. At the beginning of the current year, their stock bases are $45,000 each. In the current year, the corporation earns $40,000 of ordinary income. In addition, the corporation distributes property to George having a $26,000 FMV and a $40,000 adjusted basis and distributes property to Martha having a $26,000 FMV and a $16,000 adjusted basis. a. Determine what George and Martha recognize in the current year, and determine their ending stock bases. What bases do George and Martha have in the distributed property? b. What tax planning disadvantages do you see with these property distributions? c. How would you answer to Part a change if George and Martha form the Washington Partnership instead of an S corporation?

Place this order or similar order and get an amazing discount. USE Discount code “GET20” for 20% discount