identify the tax issue(s) posed by the facts presented. Determine the possible tax consequences of each issue that you identify. Ballou Corporation distributes $200,000 in cash to its shareholders...

identify the tax issue(s) posed by the facts presented.
Determine the possible tax consequences of each issue that you identify.

Ballou Corporation distributes $200,000 in cash to its shareholders during the
current year. Accumulated earnings and profits at the beginning of the year
are $45,000, and current year earnings and profits are $105,000. Buddy owns
80 percent of Ballou and has a basis of $60,000 at the beginning of the year