If the IRS Reclassifies Debt as Equity Under § 385

question 118

True/False

If the IRS reclassifies debt as equity under § 385, the repayment of the debt by the corporation to the shareholder automatically is treated as a dividend.

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Definitions:

Patricia A. King

A notable figure in bioethics, often recognized for her contributions to discussing issues of race, gender, and health disparities.

Disease

A condition that impairs the normal functioning of an organism, often characterized by specific signs and symptoms.

Biologically Distinct

Refers to clear differences in the biological characteristics of individuals or groups, often used in the context of species, genetics, or physiological processes.

Handicap

Historically used to describe a disadvantage or physical or mental condition that limits a person's movements, senses, or activities; contemporary language prefers terms like disability.