The Stock in Tangerine Corporation Is Held by Two Unrelated

question 27

Multiple Choice

The stock in Tangerine Corporation is held by two unrelated individuals, Janet (60%) and Joaquin (40%) .One year before the liquidation of Tangerine, the shareholders transfer properties to the corporation in a transaction that qualifies under § 351.Included in that transfer was land (basis of $600,000, fair market value of $650,000) .Pursuant to its liquidation in the current year, Tangerine Corporation distributes the land (now worth $500,000) pro rata to the shareholders. What amount of loss will Tangerine recognize on the distribution?

• A)$0.
• B)$40,000.
• C)$60,000.
• D)$100,000.
• E)None of the above.

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