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    Dwayne owns 50% of the stock of Tangerine (a C corporation)

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    Dwayne owns 50% of the stock of Tangerine (a C corporation) and 50% of the stock of Heron Corporation (an S corporation), each of which incurs an operating loss of $80,000 during 2011. Neither corporation pays any dividends during the year. Discuss Dwayne's tax consequences.

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    Dwayne would not report the loss on his 1040 for the corporation, because it was a loss. If dividends would have been paid out, the dividends would be ...

    Solution Summary

    Dwayne owns 50% of the stock of Tangerine (a C corporation) and 50% of the stock of Heron Corporation (an S corporation), each of which incurs an operating loss of $80,000 during 2011. Neither corporation pays any dividends during the year. Discuss Dwayne's tax consequences.

    $2.19

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