1 rust corporation distributes property to its sole shareholder andre the pro 383811

1.___ Rust Corporation distributes property to its sole shareholder, Andre. The property has a fair market value of $350,000, an adjusted basis of $205,000, and is subject to a liability of $220,000. Current E & P is $500,000. With respect to the distribution, which of the following statements is correct? a. Andre has dividend income of $350,000. b. Andre has dividend income of $205,000. c. Andre has dividend income of $145,000. d. Andre has dividend income of $130,000. 4.___The gross estate of Raul, decedent who died in 2012, includes 1,500 shares of stock of Orange Corporation (basis to Raul of $600,000, fair market value on date of death of $4.1 million). The estate will incur $2.2 million of death taxes and funeral and administration expenses, and the adjusted gross estate is $9 million. Orange (E & P of $5 million) redeems $2.2 million of the estates shares to pay taxes and expenses. What are the tax consequences of the redemption to Rauls estate? a. There is no recognized gain or loss on the redemption. b. $600,000 taxable gain. c. $1,600,000 taxable gain. d. $2,200,000 taxable gain. 5.___ The stock in Toucan Corporation is held equally by two brothers. Four years ago, the shareholders transfer property (basis of $200,000, fair market value of $220,000) to Toucan Corporation as a contribution to capital in a A?§351 transaction. In the current year and pursuant to a complete liquidation of Toucan, the property is distributed proportionately to the brothers. At the time of the distribution, the property had a fair market value of $40,000. What amount of loss will Toucan Corporation recognize on the distribution of the property? a. $0. b. $20,000. c. $160,000. d. $180,000.