Which of the Following Stock Distributions Would Be Nontaxable to the Shareholder

question 109

Multiple Choice

Which of the following stock distributions would be nontaxable to the shareholder?

• A) A stock distribution of one common share for every common share owned by shareholders
• B) A stock distribution where the shareholder could choose between cash and stock
• C) A stock distribution to all holders of preferred stock
• D) Both A and C are nontaxable to the shareholder