Foxrun Company has three equal shareholders, Thomas, Kimberly, and Jennifer. Kimberly and Jennifer are Thomass...
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Foxrun Company has three equal shareholders, Thomas, Kimberly, and Jennifer. Kimberly and Jennifer are Thomass daughters. On September 2 Foxrun redeemed all of Thomass stock in return for $250,000. Thomas had acquired the stock six years ago for $190,000. Foxruns current E&P was $325,000. Thomas would like to minimize his federal income tax liability. Explain the alternative available to him and how they would impact his taxable income.
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