【正文】 New 18 Tax law consideration New 19 Dividends versus capital gains Unchanged 19 20 Step transaction doctrine Unchanged 20 21 Reanizations similar to likekind exchanges Unchanged 21 202 2020 Comprehensive Volume/Test Bank 22 Original reanization view by courts and Congress Unchanged 22 Status: Q/P Question/ Present in Prior Problem Topic Edition Edition 23 Target gain recognition New 24 Recognition of gain in reanization New 25 Shareholder gain in a taxfree reanization Unchanged 25 26 Recognition of gains and losses by shareholders Unchanged 26 27 Qualifying for stock redemption treatment Unchanged 27 28 Treatment of debt security holders New 29 Basis in stock and securities received New MULTIPLE CHOICE 1 Gain and loss recognition to liquidating corporation Unchanged 1 2 Liquidating distribution of property subject to Unchanged 2 liability in excess of fair market value 3 Relatedparty loss limitation: nonpro rata distribution New 4 Relatedparty loss limitation: nonpro rata distribution Unchanged 4 5 Relatedparty loss limitation: nonapplicability to a sale Modified 5 6 Builtin loss limitation: sale pursuant to liquidation Modified 6 and no business purpose 7 Builtin loss limitation: business purpose Unchanged 7 8 Basis of property received in plete liquidation New 9 Use of installment method to defer shareholder gain Modified 9 in a plete liquidation 10 Section 332 liquidation: nonrecognition of gain to Modified 10 parent and subsidiary 11 Section 332 liquidation: consequences to parent, Unchanged 11 minority shareholder, and subsidiary 12 Section 332 liquidation: transfer in satisfaction of Unchanged 12 indebtedness to parent 13 Section 332 liquidation: consequences to parent, New subsidiary, and minority shareholder 14 Section 332 liquidation: basis of property received。 368 New 21 Dividends recognized in a reanization Unchanged 21 22 Redemption treatment Unchanged 22 23 Exchange of bonds in a reanization Unchanged 23 24 Nonrecognition of loss and basis calculation Unchanged 24 Status: Q/P Corporations: Complete Liquidation and an Overview of Reanizations 203 Question/ Present in Prior Problem Topic Edition Edition PROBLEMS 1 Corporate liquidation: relatedparty loss limitation Modified 1 2 Corporate liquidation: builtin loss limitation Modified 2 3 Distribution of installment notes in plete Modified 3 liquidation: tax consequences to corporation and shareholder 4 Section 332 liquidation: consequences to parent, New subsidiary, and minority shareholder 5 Section 338: qualified stock purchase and Unchanged 5 election deadline 6 Dividend and redemption treatment Unchanged 6 ESSAY 1 Antistuffing rules: reason for enactment New 2 Section 332 liquidation: selecting assets for Unchanged 1 distribution when minority shareholder exists 3 Section 338 election: requirements and Unchanged 2 tax consequences 4 Comparison of sale of corporate assets to sale of Unchanged 3 corporate stock 5 Comparison of reanization with likekind New exchange 204 2020 Comprehensive Volume/Test Bank TRUE/FALSE 1. Legal dissolution under state law is required for a liquidation to be plete for tax purposes. ANS: F State law does not control in determining whether a liquidation has occurred for tax purposes. Rather, the test is whether the corporation has ceased to be a going concern. PTS: 1 DIF: 1 REF: p. 202 OBJ: 4 NAT: AICPA FNReporting | AACSB Analytic MSC: 2 min 2. One similarity between the tax treatment accorded nonliquidating and liquidating distributions is with respect to the recognition of losses by the distributing corporation. As a general rule, a corporation recognizes losses on both nonliquidating and liquidating distributions of depreciated property (fair market value less than basis). ANS: F A corporation does not recognize losses on nonliquidating distributions of depreciated property. Losses generally are recognized on liquidating distributions of depreciated property, however. PTS: 1 DIF: 1 REF: p. 203 OBJ: 2 | 4 NAT: AICPA FNMeasurement | AACSB Analytic MSC: 2 min 3. As a general rule, a liquidating corporation recognizes gains but not losses on the distribution of property in plete liquidation. ANS: F Gain and loss recognition is the general rule for the liquidating corporation. PTS: 1 DIF: 1 REF: p. 203 OBJ: 4 NAT: AICPA FNReporting | AACSB Analytic MSC: 2 min 4. For purposes of the relatedparty loss limitation, ―disqualified property‖ is defined as property that is acquired by the liquidating corporation in a 167。 332 to apply. PTS: 1 DIF: 1 REF: p. 2010 | Footnote 12 OBJ: 5 NAT: AICPA FNReporting | AACSB Analytic MSC: 2 min 9. Gains and losses are recognized by a subsidiary corporation on liquidating distributions to a minority shareholder in a 167。 338 election, a corporation must acquire, in a taxable transaction, at least 50% of the stock (voting power and value) of another corporation within an 12month period. ANS: F The control requirement is at least 80% (not 50%) of the stock. PTS: 1 DIF: 1 REF: p. 2013 OBJ: 5 NAT: AICPA FNReporting | AACSB Analytic MSC: 2 min 13. If a parent corporation makes a 167。 351 for starting a corporation. ANS: F The courts originally considered even minor changes in a corporation‘s structure as taxable events. However, Congress determined that businesses should be allowed to make capital changes without being taxed. PTS: 1 DIF: 1 REF: p. 2016 | p. 2018 OBJ: 1 | 2 NAT: AICPA FNReporting | AACSB Analytic MSC: 2 min 23. In