Once basis is reduced to zero, any excess is taxed as a capital gain.Question 2 options: Save Question 6 (1 point) When current E&P has a deficit and accumulated E&P is positive, the two accounts are netted at the date of the distribution. On July 1 of the current year, the unrestricted partnership interest (fair market value of ,000) was transferred to Ophelia. Because they decided the company needed some expertise in computer networking, they offered Ophelia a 1/3 interest in partnership capital and profits if she would come to work for the partnership. In the current year, Anderson formed an equal partnership with Camilla. Anderson contributed land with an adjusted basis of ,000 and a fair market value of 5,000.
How should Ophelia treat the receipt of the partnership interest in the current year? If Cave can justify accumulations for the needs of the business of .7 million, its accumulated earnings credit for accumulated taxable income (ATI) purposes is: Question 3 options: Save Question 4 (4 points) A corporation has the following items related to AMT: Alternative minimum tax base: ,502,900 Regular corporate tax: 11,201,520 Foreign AMT tax credit: 1,400,000 Calculate the amount of AMT (if any). Part 4Distributions by a corporation to its shareholders are presumed to be a return of capital unless the parties can prove otherwise.Question 1 options: Save Question 2 (1 point) Distributions that are not dividends are a return of capital and decrease the shareholder’s basis. Phyllis and Edith formed the Coral Partnership four years ago. How much taxable gain will Sandy recognize from the sale? What items should Kayla report on her Federal income tax return? Calculate Lisa’s basis in her partnership interest at the end of the tax year.