An S Corporation Distributes Land with a Basis of $60,000

question 27

Multiple Choice

An S corporation distributes land with a basis of $60,000 and a FMV of $90,000 to its shareholder.The tax results of the distribution will be

• A)no gain to the corporation or to the shareholder.
• B)$30,000 of gain recognized by the S corporation and no pass-through to the shareholder.
• C)no gain recognized by the corporation but $30,000 of gain recognized by the shareholder.
• D)$30,000 of gain recognized by the S corporation which is passed through to the shareholder.

---

Definitions:

Widow's Peak

A V-shaped point in the hairline in the center of the forehead.

Dominant

A trait or gene that is expressed in the phenotype even when only one copy is present, overshadowing the recessive trait.

Heterozygous

A genetic condition where an individual has two different alleles for a specific gene.

Alleles

Alternative forms of a gene that occur at a specific locus on a chromosome, contributing to genetic diversity.