Parrot,Inc.,a C corporation,distributes $50,000 to its shareholder,Jerome,and land worth $50,000 (adjusted basis of $30,000)to its shareholder,Peggy.Parrot has earnings and profits of $300,000.Determine the tax consequences to Parrot,Jerome,and Peggy.

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The Answer of Parrot,Inc.,a C corporation,distributes $50,000 to its shareholder,Jerome,and land worth $50,000 (adjusted basis of $30,000)to its shareholder,Peggy.Parrot has earnings and profits of $300,000.Determine the tax consequences to Parrot,Jerome,and Peggy.