Discussion:Purchase of shareholder note
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Discussion Forum Index --> Basic Tax Questions --> Purchase of shareholder note
Discussion Forum Index --> Tax Questions --> Purchase of shareholder note
| 26 December 2007 | |
| A shareholder of an S corporation holds a note receivable from the corporation of $200,000. The other shareholders of the corporation plan to purchase this note from him for $125,000 in cash (in equal shares).
How will the future redemption of the note by the corporation be taxed at the individual level? I am thinking that each shareholder will recognize their share of the $75,000 gain as a capital gain. Does anyone have a cite to back me up on this? | |
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