Which One of the Following Statements Is Not a Requirement

question 55

Multiple Choice

Which one of the following statements is not a requirement for a divisive "D" reorganization?

• A)Pro rata distribution of stock.
• B)Active business requirement for both the original and controlled corporation.
• C)The distribution cannot be a device to distribute earnings.
• D)All of the above statements are required.

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Definitions:

Noisy Tenants

Tenants who cause a disturbance by making excessive noise, leading to complaints from other residents or neighbors.

Use and Enjoyment

The legal right to use an asset in a manner that will not be detrimental to the rights of others.

Possession

The act of having or taking into control something owned or maintained by oneself.

Covenants

Legally binding promises or agreements within contracts that stipulate actions that must be performed or refrained from by one or more parties.