Answer:
C. Buddy cannot be a creditor of the corporation after the redemption.
Explanation:
"A stock redemption that terminates a shareholder’s entire stock ownership in a corporation will qualify for sale or exchange treatment under § 302(b)(3). The attribution rules generally apply in determining whether the shareholder’s stock ownership has been completely terminated. However, the family attribution rules do not apply to a complete termination redemption if the following conditions are met:
The former shareholder has no interest, other than that of a creditor, in the corporation for at least 10 years after the redemption (including an interest as an officer, director, or employee).
The former shareholder files an agreement to notify the IRS of any prohibited interest acquired within the 10-year period and to retain all necessary records pertaining to the redemption during this time period."
Reference: South-Western, Thomson. “Chapter 5.” To Qualify for Sale or Exchange Treatment, a Stock Redemption Generally Must Result in a Substantial Reduction in a Shareholde, 2005,
Answer:
Goal formation is a process of how a goal is initiated or added to, while goal displacement is a process whereby goals are shifted out, changed, toned down or removed from the original set.
Answer:
$64,500
Explanation:
The basis of a partnership interest is the money plus the adjusted basis of any property the partner contributed. In this case adjusted basis of jerry in his partnership can be calculated as follows
Adjusted basis of Jerry In his Partnership = Partnership interest - Ordinary Loss + Long term Capital gain + Dividend-Non Deductible Expenses + Cash Contribution - Share deduction
Adjusted basis of Jerry In his Partnership = $41,000 - $6,000 + $4,900 + $3,900 - $2,400 + $29,000 - $5,900
Adjusted basis of Jerry In his Partnership = $64,500
Answer: Obtain title insurance
Explanation:
An escrow agent is someone who is trusted and holds property for third parties in case there's a ongoing disagreement that's being settled or in case whereby a transaction is being finalized and this role is usually performed by an attorney
An escrow agent can:
• Receive money from lenders.
• Offer legal advice.
• Prepare closing documents.
Therefore, an escrow agent should not obtain title insurance.