Distributions to Related Persons - Loss Recognition Is Disallowed When

question 46

Essay

Distributions to related persons - Loss recognition is disallowed when the liquidating corporation makes a distribution to a related person,as defined in Sec.267(b),if (1)the distribution is not pro rata or (2)the property distributed is disqualified property.Disqualified property is property acquired by the corporation in a Sec.351 tax-free formation or as a capital contribution during the five-year period ending on the distribution date or property having an adjusted basis that carries over from a disqualified property.

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Definitions:

Eccrine Glands

Sweat glands that are found throughout the body, producing a watery sweat that plays a crucial role in thermoregulation and cooling the body.

Apocrine Glands

Specialized sweat glands that produce a thick, milky secretion and are found in areas like the armpits and groin.

Stratum Corneum

The outermost layer of the epidermis, consisting of dead cells that help protect the skin from external elements.

Vitiligo

A skin condition characterized by patches of skin losing their pigment, becoming white.