In a liquidating distribution the cash proceeds are

At the time of X Co.'s liquidation, the fair market value of Whiteacre was ,000, and X Co. On the liquidating distribution of Whiteacre, X Co. Since Whiteacre was not disqualified property and since Whiteacre was distributed pro rata among X Co.'s three shareholders, the limitations of 336(d) on a liquidating corporation's recognition of loss do not apply. distributed a 60% interest in Whiteacre to A, a 20% interest in Whiteacre to B, and a 20% interest in Whiteacre to C. also were distributed pro rata among X Co.'s shareholders.Thirteen months after the contribution in 2003 between A and X Co. Since A had a basis of 0,000 in her 80 shares of X Co.'s stock, she recognized a loss of ,000 on X Co.'s liquidation.(Note that 267 does not prevent A from deducting that loss because that provision does not apply to a loss recognized from a distribution received pursuant to the complete liquidation of a corporation.) As to X Co.'s recognition of loss on distributing Whiteacre to B, 336(d)(1) does not apply to prevent recognition of X Co.'s loss because Whiteacre was not distributed by X Co. Therefore, unless 336(d)(2) applies, A's transfer of Whiteacre to X Co.A had a basis of ,000 in Whiteacre, and the fair market value of Whiteacre at that time was ,000.

As noted in , Whiteacre is not disqualified property.

It does not matter that Whiteacre was appreciated property when it was contributed to Y Co.; it matters only that the land was contributed to Y Co. Whiteacre to D (a related person) cannot be recognized. realized on the distribution of a 40% interest in Whiteacre to E is recognized. had only one class of stock outstanding, and it was voting, common stock.

within five years of Y Co.'s liquidation and that Y Co.'s basis was determined by the basis that D had therein. (Although the statute is clear, there appears to be no good reason for denying recognition of the loss realized on the distribution to D since the property was an appreciated asset at the time it was contributed to Y Co.) : Individual A owns 70 shares of X Co.'s outstanding stock, and individual B owns the remaining 30 shares of X Co.'s outstanding stock. The fair market value of X Co.'s stock is

As noted in , Whiteacre is not disqualified property.

It does not matter that Whiteacre was appreciated property when it was contributed to Y Co.; it matters only that the land was contributed to Y Co. Whiteacre to D (a related person) cannot be recognized. realized on the distribution of a 40% interest in Whiteacre to E is recognized. had only one class of stock outstanding, and it was voting, common stock.

within five years of Y Co.'s liquidation and that Y Co.'s basis was determined by the basis that D had therein. (Although the statute is clear, there appears to be no good reason for denying recognition of the loss realized on the distribution to D since the property was an appreciated asset at the time it was contributed to Y Co.) : Individual A owns 70 shares of X Co.'s outstanding stock, and individual B owns the remaining 30 shares of X Co.'s outstanding stock. The fair market value of X Co.'s stock is $1,000 a share.

In other words, the taxpayer must divide the number of shares he purchased in each transaction by the total number of shares he owns to determine the amount of his capital gain or loss.

If the corporation decides to only partially liquidate its assets instead, the IRS requires the same stockholder to apply the amount he receives as a cash-liquidation distribution against only the set of shares he wishes to redeem in exchange for the distribution.

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As noted in , Whiteacre is not disqualified property.It does not matter that Whiteacre was appreciated property when it was contributed to Y Co.; it matters only that the land was contributed to Y Co. Whiteacre to D (a related person) cannot be recognized. realized on the distribution of a 40% interest in Whiteacre to E is recognized. had only one class of stock outstanding, and it was voting, common stock.within five years of Y Co.'s liquidation and that Y Co.'s basis was determined by the basis that D had therein. (Although the statute is clear, there appears to be no good reason for denying recognition of the loss realized on the distribution to D since the property was an appreciated asset at the time it was contributed to Y Co.) : Individual A owns 70 shares of X Co.'s outstanding stock, and individual B owns the remaining 30 shares of X Co.'s outstanding stock. The fair market value of X Co.'s stock is $1,000 a share.In other words, the taxpayer must divide the number of shares he purchased in each transaction by the total number of shares he owns to determine the amount of his capital gain or loss.If the corporation decides to only partially liquidate its assets instead, the IRS requires the same stockholder to apply the amount he receives as a cash-liquidation distribution against only the set of shares he wishes to redeem in exchange for the distribution.

,000 a share.

In other words, the taxpayer must divide the number of shares he purchased in each transaction by the total number of shares he owns to determine the amount of his capital gain or loss.

If the corporation decides to only partially liquidate its assets instead, the IRS requires the same stockholder to apply the amount he receives as a cash-liquidation distribution against only the set of shares he wishes to redeem in exchange for the distribution.

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