C corporation owns 100% of the stock B corporation. The adjusted basis of its stock...
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Accounting
C corporation owns 100% of the stock B corporation. The adjusted basis of its stock investment is $100,000. A plan of liquidation is adopted. B corporation distributes to C corporation assets with $325,000 FMV and $275,000 adjusted basis. B corporation has $150,000 earnings and profits (E&P) balance.
What is B corporations gain and /or loss on the distribution?
$50,000 realized gain, but no recognized gain.
$225,000 realized gain and recognized gain.
$150,000 realized gain and recognized gain.
$275,000 realized gain, but no recognized gain
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