Corporate liquidating dividend
A sunset provision reverts back the law to its original language for taxable years beginning after December 31, 2010. Could their distribution be classifyied as a bonus, subject to payroll tax issues? Your perception seems good on this one with respect to the payroll taxes, though that will be based on personal circumstances.The information you gave me yesterday was so helpfull. It can almost become a legal question too depending on how much fighting between family members goes on...based on percentage of ownership and contributions to the corp, loans etc.I mostly work with S-corp and partnerships - basis calculation for C corp stock is the same?The adjusted basis for determining the gain or loss from the sale or other disposition of property, whenever acquired, shall be the basis (determined under section 1012 or other applicable sections of this subchapter and subchapters C (relating to corporate distributions and adjustments), K (relating to partners and partnerships), and P (relating to capital gains and losses)), adjusted as provided in section 1016.The C Corp I am working with just went thru an asset sale of the company and will report the gain on sale. After all entries are made, gain on sale, taxes paid, etc we have left common stock and retained earnings. The basis of property shall be the cost of such property, except as otherwise provided in this subchapter and subchapters C (relating to corporate distributions and adjustments), K (relating to partners and partnerships), and P (relating to capital gains and losses).A domestic corporation in the Philippines would normally declare dividends in the Philippines to distribute its earnings accumulated through the unrestricted or free retained earnings.
I just wanted make sure I had a handle on the situation. 109-222, §102." Here is IRC 57(a)(7) being referred to in the article: General rule For purposes of this part, the items of tax preference determined under this section are- ...(7) Exclusion for gains on sale of certain small business stock An amount equal to 7 percent of the amount excluded from gross income for the taxable year under section 1202. The liquidation will take place for all shareholders at the same time, but as a technicality, it is the 'liquidation of the shareholders' interest' that will trigger the capital gain (assuming a corporation wanted to continue, it would be a purchase of the shareholder's stock directly as opposed to via a liquidation generally, should a single shareholder get bought out by the corporation or a third party). No stock was issued and nothing was paid in for ownership other than they were employees of the company.The cost of real property shall not include any amount in respect of real property taxes which are treated under section 164 (d) as imposed on the taxpayer.Is basis calulated as would be in a partnership or s-corp?We don't want to loose the 1202 stock over this one.Thank you for all your help and I do like Just Answers and will continue to send questions to you if okay.