Reagan Corporation (a C corporation) was formed in 2022 and is a fiscal-year taxpayer with a June 30 year-end. Reagan wants to make an S election for its tax year beginning in 2025. The election must be made by

George owns a 10% interest in the Bush Partnership from January 1 through March 31 (the 91st day of the tax year) of 2025. On April 1, 2025 George buys an additional 10% interest in the partnership. On July 1, 2025 (the 182nd day of the year) George buys an additional 20% interest in the partnership. Bush Partnership’s ordinary income is $156,800 and it is earned evenly throughout the year. George’s distributive share of the ordinary income is

Thomas acquired a 25% interest in Jefferson Partnership by contributing land having an adjusted basis of $16,000 and a fair market value of $50,000.  The land was subject to a $24,000 mortgage, which was assumed by Jefferson Partnership.  No other liabilities existed at the time of the contribution.  What was Thomas’ basis in Jefferson Partnership?

George has a 30% interest in the Washington Partnership computed after taking into account his guaranteed payment of $40,000. In 2025, Washington Partnership reports ordinary income of $30,000 and capital gains of $60,000 before taking into account George’s guaranteed payment. What is the amount and character of all income or loss that George must report as a result of partnership activities?

Franklin owns a 25% interest in Pierce Partnership. On January 1, 2025 Franklin had a basis in his partnership interest of $5,000. For 2025 Pierce Partnership reported the following items: Ordinary business income – $100,000; §1231 gain – $15,000; Charitable contributions – $25,000; Tax-exempt income – 3,000; Pierce Partnership bank loan – $12,000. What is Franklin’s outside basis after adjustment for his share of these items? 

Millard transfers an asset having a FMV of $200,000 and an adjusted basis of $150,000 to Fillmore Corporation in a §351 transaction. Millard receives in exchange Fillmore common stock having an FMV of $175,000 and White House Corporation common stock (a capital asset) having a FMV of $25,000 and a basis of $10,000 to Fillmore Corporation. Fillmore Corporation must recognize

At the end of 2025, Johnson Inc. (an S corporation) liquidates by distributing long-term capital gain property ($40,000FMV, $25,000A/B) to each of its four equal shareholders ($160,000FMV, $100,000A/B). At the time of the distribution, Andrew has a basis of $15,000 in his Johnson Inc. stock. How much total gain or loss does Andrew recognize on the distribution?

Franklin is a 50% partner in the Pierce Partnership and has an outside basis of $26,000 at the end of the year prior to any distributions. On December 31, Franklin receives a proportionate operating distribution of $16,000 cash and a parcel of land with a $24,000 fair value and an $18,000 basis to Pierce. What is Franklin’s basis in the distributed property?

William Henry has a 50% interest in Harrison Partnership. The basis for his partnership interest is $50,000. The partners share the economic risk of loss from liabilities in the same way they share partnership income and losses. William Henry receives a distribution of land that has an FMV of $40,000 and an adjusted basis of $30,000. The land is subject to a $25,000 liability, which William Henry assumes. His basis in the partnership interest following the land distribution is

On December 31, 2025, after receipt of his share of partnership income, Bill sold his interest in Clinton Partnership for $30,000 cash and relief of all liabilities. On that date, the adjusted basis of Bill’s partnership interest was $40,000, consisting of his capital account of $15,000 and his share of the partnership liabilities of $25,000. What is Bill’s gain or loss on the sale of his partnership interest?