Fernando Was a One-Third Shareholder in Rodriguez, Inc

Question 94
Multiple Choice

Fernando was a one-third shareholder in Rodriguez, Inc. prior to its liquidation in March. Fernando's basis in his Rodriguez stock was $50,000. In March, Rodriguez distributed property worth $125,000 (basis $80,000) in complete liquidation of Fernando's Rodriguez shares. Fernando took the property subject to a $30,000 liability. How much taxable gain must Fernando recognize upon receipt of the property from Rodriguez? A) Zero B) $45,000 C) $75,000 D) $30,000