S Corporations Exam Question 37 of 50 Select the best answer. During an S corpor

Question

S Corporations Exam Question 37 of 50 Select the best answer. During an S corporation's post-termination transition period, which of the following statements is true? A shareholder cannot create basis in the stock to allow previously suspended losses to be A. taken O B. The S corporation can distribute any accumulated adjustments account balance tax-free. The S corporation cannot distribute any accumulated adjustments account balance after 90 days The S corporation cannot distribute any earnings and profits as a taxable dividend to the prior S corporation shareholders. O D. Submit Aniswers

Explanation / Answer

Ans-B. The S corporation can distribute any accumulated adjustments account balance tax free.

Explanation-During the post-termination transition period, the taxpayer distributed a portion of its AAAto its shareholders pursuant to Code Sec.1371(e).

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