What is a liquidating distribution

During 1992, she received salary payments from Giant of ,000 (including her portion of the health insurance premiums) and ,000 of cash distributions.Results of operations for 1992 for tax purposes are presented in Table 1.

what is a liquidating distribution-1

Linda had a 7,000 stock basis at the beginning of 1992.Is it sufficient for S corporation shareholders to maintain basis by the various blocks of stock purchased?Although not answered directly, the proposed regulations are developed within a context that would require shareholders to separately maintain basis for each share of stock held.The shareholder's oil and gas depletion deduction; c. Non- separately computed losses that pass through; and e. Reducing stock basis for non-deductible items prevents a shareholder from converting a non-deductible expense at the corporate level into a deductible expense when stock is sold or a liquidating distribution is received.Distributions in excess of basis are treated as gains from the sale of stock.

Leave a Reply