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    Nonliquidating Distribution

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    1.Deficit in accumulated E&P is $(20,000)
    Current E&P is $15,000
    On 12/31/x1, the Corp distributed $50,000 to its sole SH
    How much is considered to be dividend?

    2. Accumulated E&P is $15,000
    Deficit in current E&P $(20,000)
    On 12/31/x1, the Corp distributed $50,000 to its sole SH
    How much is considered to be dividend?

    3. Accumulated E&P is $15,000
    Deficit in current E&P $(20,000)
    On 12/31/x1, the Corp distributed $50,000 to its sole SH
    A current deficit is treated as happening evenly throughout the year, about when would the AE&P run out?
    Is there any E&P left on 12/31?

    4. Accumulated E&P is $15,000
    Deficit in current E&P $(20,000)
    What if the distribution date changes to 6/30?

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    https://brainmass.com/business/accounting/nonliquidating-distribution-259926

    Solution Preview

    Case 1
    $15,000 is considered to be the dividend which is equal to the current E&P

    Case 2
    No portion of the distribution is considered dividend because the ...

    Solution Summary

    This solution provides an analysis of each case and comments on the dividends, distribution, accumulated E&P and changes in dividends.

    $2.19

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