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QUESTION
Lenard Corp. completely liquidates its 80%-owned subsidiary, Lenita Corp.
Lenard Corp. completely liquidates its 80%-owned subsidiary, Lenita Corp. The liquidation results in a distribution to Lenard of property with a fair market value of $1,000,000 and an adjusted basis to Lenita of $400,000. How much gain will Lenard and Lenita each recognize on the transaction?
