Zebra Corporation Has Always Been an S Corporation and Is

question 91

Essay

Zebra Corporation has always been an S corporation and is 100% owned by Paul. Paul has a basis of $40,000 in his Zebra stock at the beginning of the year. During the year, Zebra has an ordinary loss of $20,000 and a long-term capital gain of $10,000. In addition, Zebra Corporation distributed $55,000 in cash to Paul on December 1. Will the distribution cause Paul to recognize a gain? If so, what are its amount and character?

---

Definitions:

Confederate

A person who is part of an experiment's setup and works for the researcher, appearing as a participant to deceive actual participants.

False Accusation

Involves wrongly accusing someone of wrongdoing or misconduct without evidence or based on incorrect information.

Deviancy Training

A process through which individuals are influenced by peers to engage in antisocial or criminal behavior, reinforcing such behavior as acceptable or normative.

Delinquency Socialization

involves the process by which individuals learn delinquent behaviors and norms from their interactions within certain groups or environments.