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4.         What are the tax consequence to the corporation of the following alternative liquidating distributions?            ...

4.         What are the tax consequence to the corporation of the following alternative liquidating distributions?

            Lynch, Inc. distributes its assets to George and D as tenants in common, George taking an undivided 4/5ths in each parcel of real estate (Green Acre) (and $160,000 in cash) and D taking an undivided 1/5th in each parcel of land (and $40,000 in cash). Green Acre was acquired four years ago, when its fair market value and basis were both $500,000, as a contribution by George in a § 351 transaction in exchange for enough stock to increase his stock ownership from 40% to 80%.

Determine the tax consequences to all parties.

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