Joined: 05 Oct 2011 Location: United States
Online Status: Offline Posts: 155
Posted: 17 Feb 2012 at 10:19 | IP Logged
We're at a stand still. Me and TaxProfMom agree that the answer is Becker, and audreyP and midi13579 agree that it's Wiley. Who will break the tie (even though I know Becker is right)? :-)
-Jacob
__________________ BEC - (65, 75, lost credit re-take May 30, 2012)
FAR - (42, 60, 64, 76)
AUD - (63, 87)
REG - (70, 58, 50 69, 70, 88--FINALLY!!)
Joined: 19 Jan 2012 Location: United States
Online Status: Offline Posts: 14
Posted: 18 Feb 2012 at 07:29 | IP Logged
Hi,
I did a quick review and looks like $7000 is the right
answer, because S-corp. does not adopt "only LTCG can
offset LTCL" rule. I just send an email to the instructor
to obtain an answer from him, let's see what he says.
This placed me in a bad mood, because I have already took
my REG exam on Feb.2, let's hope this didn't affect my
ability to pass Regulation.
Joined: 19 Jan 2012 Location: United States
Online Status: Offline Posts: 14
Posted: 19 Feb 2012 at 21:34 | IP Logged
This is what the instructor says.... I found it to be
useless....
This sounds like it may be a trick question, Midi. The
general rule is that shareholders of an S-Corp are not
taxed on distributions form the corporation. It's like a
bank account. The shareholders recognize income when it
is received by the corporation, not when it is paid out
to the individual. So, a cash distribution from the
corporation reduces the shareholder's basis in the
corporate stock but ordinarily is not a taxable event to
the corporation or the shareholder. The S-Corp ordinary
income and capital gains would flow through as income to
the shareholder, but those amounts would be added to the
shareholder's other income and capital gain items and be
taxed to the shareholder.
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Topic: Same Question Becker V.S Wiley
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