1 / 6

Getting Assets Out of a C Corporation

(c) 2011, WmARaabe, Tax II ch5. 2. Getting Assets Out of a C Corporation. Fringe BenefitsSalary, Interest, RentalsCapital GainsDividends. (c) 2011, WmARaabe, Tax II ch5. 3. Corporate Distributions are made from (in order):. Current E

kayleen
Download Presentation

Getting Assets Out of a C Corporation

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

    1. (c) 2011, WmARaabe, Tax II ch5 1 Getting Assets Out of a C Corporation

    2. (c) 2011, WmARaabe, Tax II ch5 2 Getting Assets Out of a C Corporation Fringe Benefits Salary, Interest, Rentals Capital Gains Dividends

    3. (c) 2011, WmARaabe, Tax II ch5 3 Corporate Distributions are made from (in order): Current E&P (taxable dividend) Accumulated E&P (taxable dividend) Shareholder�s Capital (no gross income, reduce basis in shares) Capital Gain

    4. Earnings and Profits (c) 2011, WmARaabe, Tax II ch5 4

    5. (c) 2011, WmARaabe, Tax II ch5 5 Cash Distributions, E&P Netting Assume a 12/31 $20,000 cash distribution, in each independent situation.

    6. (c) 2011, WmARaabe, Tax II ch5 6 Property Dividends Distribution = FMV of prop � Liabilities Corp recognizes gain not loss on distrib property. This increases E&P E&P decreases by Greater of Adj basis or FMV MINUS Liabilities Gross income to shareholder, to extent of E&P = FMV � Liabilities Basis of asset to shareholder = FMV

    7. (c) 2011, WmARaabe, Tax II ch5 7 Distribution of Property Distribution of asset, basis to corp 20, in each independent situation, when E&P > 100

More Related